Ms Janet Jackson is the proprietor of Janet’s Sewing Services. Janet prepares her accounts on a monthly basis. The Unadjusted Trial Balance at 31 March 2018 is shown below:
Janet’s Sewing Services
Unadjusted Trial Balance
31 March 2018
Accounts | Debit | Credit |
$ | $ | |
Cash at bank | 8,500 | |
Accounts receivable | 5,200 | |
Supplies | 1,500 | |
Prepaid rent | 1,200 | |
Equipment | 8,000 | |
Accumulated depreciation – equipment | 333 | |
Accounts payable | 1,520 | |
Bank loan (due 2020) | 8,000 | |
Capital, Janet Jackson (1/3/18) | 9,797 | |
Drawings, Janet Jackson | 3,000 | |
Service revenue | 11,200 | |
Utilities expense | 300 | |
Wages expense | 3,150 | |
Totals | 30,850 | 30,850 |
Additional information for adjusting entries:
- A physical stock-take has determined supplies on hand at 31 March are $1,100.
- Rent on the business premises was paid in advance for 3 months at the beginning of March.
- A typical weekly payroll is $750. The employee is paid for a 5-day week (Mon-Fri), and is paid each Thursday (inclusive). 31 March was a Saturday.
- Interest on the interest-only loan for the month of March won’t be paid until the first week of April. The interest rate is 8% per annum.
- Janet withdrew $900 from the business on the last day of the month for her own use and did not record it.
- The equipment has a 5-year useful life with no salvage value. It is being depreciated on a straight-line basis.
Required:
- Prepare the necessary general journal adjusting entries for the month ended 31 March 2018 (include narrations).
- Prepare the Income Statement for Janet’s Sewing Services for the Month Ended 31 March 2018.
- Prepare the Statement of Changes In Equity for Janet’s Sewing Services for the Month Ended 31 March 2018.
- Prepare the classified Balance Sheet for Janet’s Sewing Services As At 31 March 2018.
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