Quiz 1 Denise’s Cleaning Services
Denise’s Cleaning Services has been operating for 5 years. At December 31 of last year, the accounting records reflected the following:
|Assets||Amount||Liabilities & Equity||Amount|
|Cash||$ 23,000||Accounts Payable||$ 20,000|
|Marketable Securities||2,000||Notes Payable (Short-Term)||8,000|
|Accounts Receivable||5,000||Long Term Notes Payable||47,000|
|Factory||90,000||Additional Paid in Capital||60,000|
|Total Assets||$175,000||Total Liabilities & Equity||$175,000|
During the current year, the company had the following summarized activities:
a. Purchased furniture for $13,000 cash.
b. Purchase supplies on account for $3,000.
c. Purchased equipment that cost a total of $29,000; paid $5,000 cash and signed a one-year note for the balance.
d. Hired a new president at the end of the year. The contract was for $60,000 per year plus options to purchase company stock at a set price based on company performance.
e. Issued additional shares of common stock for $5,000 cash and $15,000 in equipment.
f. Borrowed $48,000 cash as a two-year note payable from a local bank.
g. Purchased Land for $40,000 cash.
h. Performed Services for a customer and received $15,000 cash.
i. Built an addition to the factory for a total cost of $45,000; paid $9,000 in cash and signed a three-year note for the balance.
j. Performed services for a customer on account for $12,600.
k. Paid $5,200 on account.
l. Received $3,100 from a customer on account.
m. Paid expenses: Rent-$1,500 and Salaries-$4,000
n. Paid dividends $2,000.
1. Create a journal entry for each transaction.
2. Prepare a trial balance as of December 31 of the current year.
3. Prepare an Income Statement of December 31 of the current year.
4. Prepare a Statement of Retained Earnings as of December 31, of the current year.
5. Prepare a Balance Sheet as of December 31, of the current year.