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  • Project No. 1: Accounting Cycle Step 1 To 4 For Service Business (Weygant, Et Al, Page 86)

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    John Lim opened a dental clinic and had various business transactions in August and September. The transactions included depositing cash, purchasing equipment on credit, borrowing money, receiving payment for services, paying expenses. The summary is: 1) John Lim deposited cash and purchased equipment, borrowed money, and provided dental services. 2) Various expenses were paid such as wages, advertising, supplies, utilities, and interest. 3) Payments were made toward accounts payable for equipment and the loan was partially paid down.

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    John Lim opened a dental clinic and had various business transactions in August and September. The transactions included depositing cash, purchasing equipment on credit, borrowing money, receiving payment for services, paying expenses. The summary is: 1) John Lim deposited cash and purchased equipment, borrowed money, and provided dental services. 2) Various expenses were paid such as wages, advertising, supplies, utilities, and interest. 3) Payments were made toward accounts payable for equipment and the loan was partially paid down.

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    © All Rights Reserved
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    28 views1 page

    Project No. 1: Accounting Cycle Step 1 To 4 For Service Business (Weygant, Et Al, Page 86)

    Uploaded by

    jii
    John Lim opened a dental clinic and had various business transactions in August and September. The transactions included depositing cash, purchasing equipment on credit, borrowing money, receiving payment for services, paying expenses. The summary is: 1) John Lim deposited cash and purchased equipment, borrowed money, and provided dental services. 2) Various expenses were paid such as wages, advertising, supplies, utilities, and interest. 3) Payments were made toward accounts payable for equipment and the loan was partially paid down.

    Copyright:

    © All Rights Reserved
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    of 1

    MGT 111: Principles of Accounting

    M.A. Perez

    Project no. 1: Accounting cycle step 1 to 4 for service business (Weygant, et al, page 86)
    John Lim opened his dental clinic providing specialist orthodontic services J. Lim Dental Clinic on 1 August 2010. The
    following transactions took place during the first two months of operation.
    Aug.

    Sept.

    1
    2
    4
    6
    11
    12
    17
    18
    19
    28
    31
    31
    2
    4
    6
    13
    14
    20
    21
    22
    24
    25
    30

    Deposited P20,000 into the business bank account.


    Purchased dental equipment on credit from Dental Supplies for P35,000.
    Barrowed P20,500 from East Bank.
    Purchased office supplies for P400
    Received P4,000 for services rendered.
    Paid wages of P600 to employees.
    Performed dental services of P2,300 on account.
    Withdrew P300 for personal use.
    Paid P325 for advertising in the local paper.
    Paid P1,200 to Dental Supplies as partial payment.
    Received cash for dental services of P1,200.
    Paid interest on the loan for the month of P70.
    Purchased dental equipment for P650.
    Paid electricity expense of P230.
    Paid telephone expense of P240.
    Received P7,000 for services rendered.
    Paid wages of P600 to employees.
    Performed dental services of P1,300 on account.
    Withdrew P500 for personal use.
    Paid P1,200 to Dental Supplies as part payment.
    Received P1,500 for dental services performed.
    Purchased additional dental equipment of P350.
    Received cash from dental services for P2,300.

    J. Lim Dental Clinic uses the following chart of accounts: No. 101 Cash; No. 120 Accounts Receivable; No. 130 Dental
    Equipment; No. 140 Office Supplies; No. 201 Accounts Payable; No. 210 Loan Payable; No. 301 J. Lim, Capital; No. 302
    J. Lim Drawings; No. 400 Dental Service Revenue; No. 512 Wages Expense; No. 522 Advertising Expense; No. 532
    Interest Expense; No. 542 Electricity Expense; No. 552 Telephone Expense.
    Instructions:
    a) Step 1: Analyzing
    paper.)

    b) Step 2: Journalizing
    (with explanation and PR)
    c)

    Step 3: Posting

    Prepare the debit and credit analysis. (You can put this in yellow
    Journalized the transactions for Aug and Sept in a 2 column journal.

    Post Aug and Sept journal entries to ledger. (with explanation and PR)

    d) Step 4: Trial Balance - Prepare a trial balance as at September 30, 2010 (You can write this in a 2
    column journal)

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