Balance Sheet of a Trucking Company by yyp14196

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									QS4-2

1.   (f)   Analyzing transactions.
2.   (i)   Journalizing transactions.
3.   (b)   Posting the journal entries.
4.   (h)   Preparing the unadjusted trial balance.
5.   (c)   Journalizing and posting adjusting entries.
6.   (d)   Preparing the adjusted trial balance.
7.   (g)   Preparing the financial statements.
8.   (e)   Journalizing and posting closing entries.
9.   (a)   Preparing the post-closing trial balance.
 Exercise 4-1

 Closing entries:
 (1)      Services Revenue.........................................      74,000
              Income Summary ..................................                      74,000
            To close the revenue account.
 (2)      Income Summary .........................................       52,100
              Rent Expense ........................................                   9,600
              Salaries Expense ..................................                    21,000
              Insurance Expense ...............................                       4,500
              Depreciation Expense ..........................                        17,000
            To close the expense accounts.
 (3)      Income Summary .........................................       21,900
              M. Mallon, Capital .................................                   21,900
            To close income summary.
 (4)      M. Mallon, Capital ........................................    25,000
              M. Mallon, Withdrawals ........................                        25,000
            To close the withdrawals account.
Posted accounts:
M. Mallon, Capital               No. 301               Salaries Expense                    No. 622
Date PR    Debit        Credit  Balance                Date PR Debit              Credit  Balance
Mar.31                            42,000               Mar.31                               21,000
 (3)                     21,900   63,900                 (2)                       21,000        0
 (4)        25,000                38,900

M. Mallon, Withdrawals           No. 302                Insurance Expense                  No. 637
Date PR    Debit        Credit  Balance                Date PR          Debit     Credit  Balance
Mar.31                            25,000               Mar.31                                4,500
 (4)                     25,000        0                 (2)                        4,500        0

Services Revenue                       No. 401         Rent Expense                        No. 640
Date PR    Debit        Credit        Balance          Date PR Debit              Credit  Balance
Mar.31                                  74,000         Mar.31                                9,600
 (1)        74,000                           0           (2)                        9,600        0

Depreciation Expense             No. 603                Income Summary                     No. 901
Date PR    Debit        Credit  Balance                Date PR          Debit     Credit  Balance
Mar.31                            17,000                 (1)                       74,000   74,000
 (2)                     17,000        0                 (2)            52,100              21,900
                                                         (3)            21,900                   0
Exercise 4-4

                                        WEBB TRUCKING COMPANY
                                             Balance Sheet
                                           December 31, 2005
                                                          Assets
  Current assets
   Cash................................................................                                    $    7,000
   Accounts receivable .....................................                                                   16,500
   Office supplies...............................................                                               2,000
   Total current assets ......................................                                                 25,500
  Plant assets
   Trucks............................................................. $170,000
   Accumulated depreciation-Trucks .............. (35,000)                                                  135,000
   Land................................................................                                      75,000
   Total plant assets ..........................................                                            210,000
  Total assets......................................................                                       $235,500
                                                        Liabilities
  Current liabilities
   Accounts payable..........................................                                              $ 11,000
   Interest payable .............................................                                             3,000
   Total current liabilities ..................................                                              14,000
  Long-term notes payable................................                                                    52,000
  Total liabilities .................................................                                        66,000
                                           Equity
                                 *
  K. Webb, Capital .............................................                                            169,500
  Total liabilities and equity ..............................                                              $235,500


   *
       K. Webb, Capital is computed as:
       Beginning balance ..................................................................................... $161,000
       Plus: Net income ($128,000 - $22,500 - $60,000 - $7,000 - $11,000)......                                    27,500
       Less: Withdrawals .....................................................................................    (19,000)
       Ending balance .......................................................................................... $169,500
Exercise 4-5

                              WEBB TRUCKING COMPANY
                                    Income Statement
                            For Year Ended December 31, 2005

  Trucking fees earned ................................................           $128,000
  Expenses
     Depreciation expense—Trucks........................... $22,500
     Salaries expense .................................................. 60,000
     Office supplies expense ...................................... 7,000
     Repairs expense—Trucks ................................... 11,000
     Total expenses .....................................................          100,500
  Net income .................................................................    $ 27,500




                              WEBB TRUCKING COMPANY
                               Statement of Owner’s Equity
                            For Year Ended December 31, 2005

  K. Webb, Capital, December 31, 2004......................                       $161,000
  Plus: Net income .......................................................          27,500
                                                                                   188,500
  Less: Owner withdrawals .........................................                (19,000)
  K. Webb, Capital, December 31, 2005......................                       $169,500

								
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