Solving Problem - Article Example

Journal Entries JOURNALS IN THE BOOKS OF LIWA CONSTRUCTION CO. DATE PARTICULARS Post Ref. Debit (Amount) Credit (Amount) 1/3/10 Cash A/C   750000   Building A/C   180000     Capital A/c   930000 (Being cash and building invested by owner as capital while starting the business)        1/4/10 Land A/c   110000   Construction Equipment A/c   200000 Cash A/c   120000 Loan A/c   190000 (Being land and cash equipment purchased partially in cash and partially through loan)     1/4/10 Insurance Policy A/c   3200 Cash A/c   3200 (Being insurance policy bought in cash)     5/4/10 Office Supplies A/c   1100 Creditors A/c   1100 (Being office supply purchased on credit)   15/5/10 Rent A/c 24000 Cash A/c 24000 (Being rent paid)   15/5/10 Truck A/c   120000 Cash A/c   30000 General Motor A/c   90000 (Being truch purchased partially on cash and patially through note payable)     17/6/10 Cash A/c   75000 ABC Co. Advance for Services A/c   75000 (Being advance received from ABC for services for 3 years)     24/9/10 XYZ Co. A/c   90000 Construction Services A/c   90000 (Being construction services provided to XYZ Co and payment due)       31/10/10 Telephone Expenses A/c   250 Cash A/c   250 (Being telephone bill paid)     30/11/10 Electricity Bill A/c   130 Cash A/c   130 (Being electricity bill received and paid)     30/11/10 General Motors A/c   45000 Cash A/c   45000 (Being partial payment made on truck purchased through General Motors)     1/12/10 ABC Co. Advance for Services A/c   25000 ABC Services A/c   25000 (Being first stage construction provided)     31/12/10 Salaries A/c   21000 Salaries Payable A/c   21000 (Being salaries due but not paid)     31/12/10 Capital A/c   11000 Cash A/c   11000 (Being drawings made by John the owner)     31/12/10 Office Supplies Consumed A/c   700 Office Supplies A/c   700 (Being office supplies used)     Ledger Accounts Capital A/c DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To Cash A/c 11000 1/3/10 By Cash A/c   750000 31/12/10 To balance C/d 919000 1/3/10 By Building A/c   180000       930000         930000 1/1/11 By Balance b/d 919000 Loan A/c DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To Balance C/d 190000 1/4/10 By Construction Equipment A/c 190000 190000 190000 1/1/11 By balance b/d 190000 Building A/c DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 1/3/10 To Capital A/c 180000 31/12/10 By Balance c/d 180000       180000         180000 1/1/11   To Balance b/d   180000       Land A/c DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 1/4/10 To Cash A/c 110000 31/12/10 By Balance c/d 110000                       110000       110000 1/1/11 To balance b/d   110000         Construction Equipment A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 1/4/10 To Cash A/c 10000 31/12/10 By Balance c/d 200000 1/4/10 To Loan A/c 190000       200000        200000               1/1/11 To Balance b/d   200000         Insurance Policy A/c DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 1/4/10 To cash A/c 3200 31/12/10 By Profit & Loss A/c 3200       3200       3200 Office Supplies A/c DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 5/4/10 To Creditors A/c 1100 31/12/10 By Office Supplies Consumed A/c 700 31/12/10 By Balance c/d 400 1100 1100 1/1/11 To balance b/d 400 CASH A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 1/4/10 To Capital A/c 750000 1/3/10 By Land A/c 120000 17/6/10 To ABC Co. Advance for Services A/c 75000 1/4/10 By Insurance Policy A/c 3200 15/5/10 By Rent A/c 24000 15/5/10 By Truck A/c 30000 31/10/10 By Telephone Expenses A/c 250 30/11/10 By Electricity Bill A/c 130 30/11/10 By General Motors A/c 45000 31/12/10 By Capital A/c 11000 31/12/10 By Balance c/d 591420 825000 825000 1/1/11 To Balanc b/d 591420 Rent A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 15/5/10 To Cash A/c 24000 31/12/10 By Balance c/d 24000 24000 24000 1/1/11 To balance b/d 24000 Creditors A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To Balance c/d 1100 5/4/10 By Office Supplies A/c 1100 1100 1100 1/1/11 By Balance b/d 1100 Truck A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 15/5/10 To Cash A/c 30000 31/12/10 By Balance c/d 120000 15/5/10 To General Motors A/c 90000 120000 120000 1/1/11 To Balance b/d 120000 General Motors A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 30/11/10 To Cash A/c 45000 15/5/10 By Truck A/c 90000 31/12/10 To balance c/d 45000 90000 90000 1/1/11 By Balance b/d 45000 Office Supplies Consumed A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To Office Supplies A/c 700 By Profit & Loss A/c 700 700 700 ABC Co Advance for Services A/c DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 1/12/10 To ABC Services A/c 25000 17/6/10 By cash A/c 75000 31/12/10 To balance c/d 50000 75000 75000 1/1/11 By balance b/d 50000 XYZ Co. A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 24/9/10 To Construction Services 90000 31/12/10 By balance c/d 90000 90000 90000 1/1/11 To balance b/d 90000 Construction Services A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To Profit & loss A/c 90000 24/9/10 By XYZ Co A/c 90000 90000 90000 Telephone Expense A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/10/10 To Cash A/c 250 31/12/10 By Profit & Loss A/c 250 250 250 Electricity Bill A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 30/11/10 To Cash A/c 130 31/12/10 By Profit & loss A/c 130 130 130         ABC Services A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To Profit & Loss A/c 25000 1/12/10 By ABC Co. Advance for Services A/c 25000 25000 25000 Salaries A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To Salaries Payable A/c 21000 31/12/10 By Profit & loss A/c 21000 21000 21000 Salaries Payable A/C DATE PARTICULARS   AMT(IN $) DATE PARTICULARS   AMT(IN $) 31/12/10 To balance c/d 21000 31/12/10 By Salaries A/c 21000 21000 21000 1/1/11 By Balance b/d 21000 Trial Balance NAME OF ACCOUNTS L.F BALANCE BALANCE     DR.(IN $) CR.(IN $)         Capital A/c 919000 Loan A/c 190000 Building A/c 180000 Land A/c 110000 Construction Equipment A/c 200000 Insurance Policy A/c 3200 Office Supplies A/c 400 Cash A/c 591420 Creditors A/c 1100 Truck A/c 120000 General Motors A/c 45000 Office Supplies Consumed A/c 700 ABC Co. Advance for Services A/c 50000 XYZ Co A/c 90000 Construction Services A/c 90000 Telephone Expenses A/c 250 Electricity Bill A/c 130 ABC Services A/c 25000 Salaries A/c 21000 Salaries Payable A/c 21000 Rent A/c 24000 Total 1341100 1341100 Adjusting Entries IN THE BOOKS OF LIWA CONSTRUCTION CO. DATE PARTICULARS Post Ref. Debit (Amount) Credit (Amount) 31/12/10 Depreciation A/c 7200 Building A/c 7200 (Being adjusting entry for depreciation charged on building) 31/12/10 Depreciation A/c 10000 Construction Equipment A/c 10000 (Being adjusting entry for depreciation charged on construction equipment) 31/12/10 Interest A/c 17100 Interest Payable A/c 17100 (Being adjusting entry for interest payable made due) 31/12/10 Insurance Expenses A/c 3200 Insurance Policy A/c 3200 (Being adjusting entry for insurance passed) 31/12/10 Office Supplies Expenses A/c 700 Office Supplies A/c 700 (Being adjusting entry for office supplies passed) 31/12/10 Prepaid Rent A/c 11000 Rent A/c 11000 (Being adjusting entries for rent passed) 31/12/10 Depreciation A/c 20000 Truck A/c 20000 (Being adjusting entries for depreciation on truck passed) 31/12/10 Unearned Revenue A/c 50000 ABC Co. Advance for Services A/c 50000 (Being adjusting entries for unearned revenue passed) Adjusted Trial Balance Adjustments Adjusted Trial balance NAME OF ACCOUNTS BALANCE BALANCE Debit Credit BALANCE BALANCE   DR.(IN $) CR.(IN $) DR.(IN $) CR.(IN $)       Capital A/c 919000 919000 Loan A/c 190000 190000 Building A/c 180000 7200 172800 Land A/c 110000 110000 Construction Equipment A/c 200000 10000 190000 Insurance Policy A/c 3200 3200 Office Supplies A/c 400 400 Cash A/c 591420 591420 Creditors A/c 1100 1100 Truck A/c 120000 20000 100000 General Motors A/c 45000 45000 Office Supplies Consumed A/c 700 700 ABC Co. Advance for Services A/c 50000 50000 XYZ Co A/c 90000 90000 Construction Services A/c 90000 90000 Telephone Expenses A/c 250 250 Electricity Bill A/c 130 130 ABC Services A/c 25000 25000 Salaries A/c 21000 21000 Salaries Payable A/c 21000 21000 Rent A/c 24000 11000 13000 Depreciation A/c 37200 37200 Interest A/c 17100 17100 Interest Payable A/c 17100 17100 Insurance Expesnes A/c 3200 3200 Prepaid Rent A/c 11000 11000 Unearned Revenue A/c 50000 50000 1358200 1358200 Income & Expenditure Account TO INCOME & EXPENDITURE A/C as on 31/12/10         PARTICULARS AMT(IN $) PARTICULARS AMT(IN $) To Office Supplies Consumed 700 By Construction Services 90000 To Telephone Expenses 250 By Loss 2580 To Electricity Bill 130 To Salaries 21000 To Rent 13000 To Depreciation 37200 To Interest 17100 To Insurance Expenses 3200 92580 92580 Balance Sheet BALANCE SHEET         LIABILITIES AMT(IN $) ASSETS AMT(IN $) Capital 919000 Building 172800 Loan 190000 Land 110000 Creditors 1100 Construction Equipment 190000 General Motors 45000 Office Supplies 400 ABC Services 25000 Cash 591420 Salaries Payable 21000 Truck 100000 Interest Payable 17100 XYZ Co 90000 Unearned Revenue 50000 Prepaid Rent 11000 Loss 2580 1268200 1268200 Read More