The L&L Accounting Firm_JOURNAL TO FINANCIAL STATEMENTS

ACCT120 Principles of Accounting I Key Graded Assignment – Preparing Financial Statements Handout

The
L&L Accounting Firm

The
May 31, 20XX, post-closing trial balance for the L&L Accounting Firm
appears below.

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During
June, the firm engaged in the following transactions:

1 Received an investment of cash from J. Long,
$8,000.

3 Purchased office equipment with cash,
$2,000.

4 Received office equipment transferred to
the firm from J. Long, $1,800

7 Purchased extra office supplies with
cash, $190

9 Completed bookkeeping services for Elliott Electric Company
that began on May 30 and billed Elliott for the total services performed,
including the accrued revenues that had been recognized in an adjusting entry
in May, $1,400

10 Paid the receptionist for two weeks’
wages, $1,600

13 Paid the amount due to Office Depot for
the office equipment purchased last month,
$750

14 Accepted an advance in cash for services
to be done for a new client, $2,200

15 Purchased a copier (office equipment) from Office Depot for
$2,400, paying $400 in cash and agreeing to pay the rest in equal amounts over
the next six months.

16 Performed consulting services and received
a cash fee, $1,650.

17 Received payment on account from Sally’s
Salon for services performed last month,
$3,200.

18 Paid amount due for the telephone bill that was received and
recorded at the end of May, $260.

19 Performed consulting services for Sally’s Salon and agreed to
accept payment next month, $4,600.

20 Performed bookkeeping services for cash,
$780.

23 Received and paid the utility bill for
June, $340.

24 Paid the secretary for two weeks’ wages,
$1,600.

27 Paid the rent for July in advance, $2,000.

28 Received the telephone bill for June,
which is to be paid next month, $220.

30 Paid cash to J. Long as a withdrawal for
personal expenses, $1,750.

1.
Record the
journal entries for June.

1.
Post the June
transactions to the general ledger accounts.

1.
Prepare a
trial balance.

1.
Prepare
adjusting entries in a worksheet using the information below:

·
Three days’
wages accrued by the end of June.

·
Consulting
services performed (that will not be billed until July) total $380.

·
Consulting
services for which payment has been received in advance amounted to $1,460.

·
Depreciation
on office equipment for June is $320.

·
Depreciation
on office furniture for June is $200.

·
An inventory
of office supplies shows $200 still on hand as of June 30.

·
One month’s
prepaid insurance has expired in the amount of $100.

·
One month’s
prepaid rent has expired in the amount of $2,000.

1.
Record the
closing entries and post them to the ledger accounts.

1.
Prepare a
post-closing trial balance.

1.
From the
worksheet, prepare an income statement, statement of owners’ equity, and balance
sheet.

1.
Answer the
following questions as a summary of your work:

·
What
information were you able to glean about the financial situation of this
company from the financials?

·
How does this
accounting information impact business decisions?