Journal Chapter 3

Required

Before you begin, print out all the pages in this workbook.
Roth Contractors Corporation was incorporated on December 1, 2019.
Required:
Part A
1 Prepare journal entries to record the December transactions shown on page “Transactions Pt. A”. General ledger account numbers and descriptions are not needed.
2 Post the entries to general ledger T-accounts.
Part B
3 Prepare all necessary adjusting entries based on the information shown on the printed “Adj. Entries Pt. B” page. General ledger account numbers and descriptions are not necessary.
4 Post the entries to general ledger T-accounts and calculate balances.
5 Prepare an adjusted trial balance at December 31.
6 Prepare an income statement, statement of changes in equity, and balance sheet. Assume the fiscal year-end is December 31, 2019.
7 Prepare closing entries and a post-closing trial balance at December 31, 2019.

Transactions Pt. A

2019
December Transactions Amount
a. Issued common stock for cash 2,000
b. Paid cash for three month’s rent: December 2019, January and February 2020 2,400
c. Purchased a used truck on credit (recorded as an account payable) 13,000
d. Purchased supplies on credit. These are expected to be used during the month (recorded as expense) 1,600
e. Paid for a one-year truck insurance policy, effective December 1 2,280
f. Billed a customer for work completed to date 6,000
g. Collected cash for work completed to date 4,000
h. Paid the following expenses in cash:
Advertising 700
Interest 700
Telephone 800
Truck operating 600
Wages 5,000
i. Collected part of the amount billed in f above 1,000
j. Billed customers for work completed to date 7,000
k. Signed a contract for work to be performed in January 2020 9000 5,000
l. Paid the following expenses in cash:
Advertising 600
Interest 600
Truck operating 900
Wages 2,000
m. Collected an advance on work to be done in January (the policy of the coproration is to record such advances as revenue at the the time they are received)
2,000
n. Received a bill for electricity used during the month (recorded as utilities expense) 800

Adj. Entries Pt. B

2019
December Adjusting Entries Amount
o. One month of the prepaid insurance has expired. $170
p. The December portion of the rent paid on December 1 has expired. $900
q. Counted supplies and found this amount still on hand (recorded the amount used as an expense) $100
r. The amount collected in transaction m is unearned at December 31. $2,000
s. Three days of wages for December 29, 30, and 31 are unpaid. These will be paid in January.
$2,900
t. One month of depreciation needs to be recorded. Estimated useful life of truck in years is: 361.1111111111 3
u. Income taxes expense to be paid in the next fiscal year. $100

T-accounts

Roth Contractors Corporation
Cash Accounts Payable Repair Revenue Rent Expense
Supplies Expense
Accounts Receivable Wages Payable Advertising Expense
Telephone Expense
Unearned Repair Revenue
Prepaid Insurance
Income Taxes Payable Depreciation Exp. – Truck Truck Operating Expense
Prepaid Rent
Common Stock Insurance Expense
Utilities Expense
Unused Supplies
Interest Expense
Wages Expense
Truck
Acc. Dep’n – Truck Income Taxes Expense

Jnl. Entries

Roth Contractors Corporation
GENERAL JOURNAL
Dec.
2019 Description F Debit Credit
Roth Contractors Corporation
GENERAL JOURNAL
Dec.
2019 Description F Debit Credit
Roth Contractors Corporation
GENERAL JOURNAL
Dec.
2019 Description F Debit Credit

Adj. Trial Bal.

Roth Contractors Corporation
Adjusted Trial Balance
At December 31, 2019
Post-closing Trial Balance
Accounts Balances Closing Entries
Account Title Debit Credit # Debit Credit # Debit Credit
Cash
Accounts Receivable
Prepaid Insurance
Prepaid Rent
Unused Supplies
Truck
Accum. Dep’n. – Truck
Accounts Payable
Wages Payable
Income Taxes Payable
Unearned Revenue
Common Stock
Retained Earnings
Income Summary
Repair Revenue
Advertising Expense
Dep’n. Expense – Truck
Insurance Expense
Interest Expense
Rent Expense
Supplies Expense
Telephone Expense
Truck Operating Expense
Utilities Expense
Wages Expense
Income Taxes Expense

Statements

Roth Contractors Corporation Roth Contractors Corporation
Income Statement Balance Sheet
For the Month Ended Dec. 31, 2019 At December 31, 2019
Revenue Assets
Expenses
Liabilities
Roth Contractors Corporation
Statement of Changes in Equity Stockholders’ Equity
For the Month Ended December 31, 2019
Common stock Retained earnings Total equity
Opening balance
Ending balance

Copyright

Copyright © 2018 David Annand
Published by David Annand
Box 308, Rochester AB T0G 1Z0
ISBN: 978-0-9953266-6-8
Library and Archives Canada Cataloguing in Publication
Annand, David, 1954–
This case is licensed under a Creative Commons License, Attribution–Non-commercial–Share Alike 4.0 USA see www.creativecommons.org. This material may be reproduced for non-commercial purposes and changes may be used by others provided that credit is given to the author.
To obtain permission for uses beyond those outlined in the Creative Commons license, such as personalized assignments for students, please contact David Annand at davida@athabascau.ca.
Latest version available at https://open.bccampus.ca/find-open-textbooks/
Please forward suggested changes to davida@athabascau.ca.
First US Edition
July 31, 2018
 
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