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Chapter 2: Q11E (page 93)

Creating a chart of accounts Raymond Autobody Shop has the following accounts:

Accounts Payable Service Revenue

Cash Equipment

Utilities Expense Common Stock

Automotive Supplies Advertising Expense

Dividends Unearned Revenue

Retained Earnings

Create a chart of accounts for Raymond Autobody Shop using the standard numbering system. Each account is separated by a factor of 10. For example, the first asset account will be 100 and the next asset account will 110

Short Answer

Expert verified

A chart of accounts helps the business to organize all the accounts and the required chart of accounts is prepared. A Detailed chart of accounts is shown in step 2.

Step by step solution

01

Definition of Chart of Accounts

The chart of accounts is the account that is prepared which shows the list of all company accounts with the accounts number.

02

Preparation of Chart of Accounts

Balance Sheet and statement of retained earnings accounts

Assets

Liabilities

Equity

100 Cash

200 Accounts Payable

300 Common Stock

110 Automotive Supplies

210 Unearned Revenue

310 Retained Earnings

120 Equipment

320 Dividends

Income Statement Accounts (Part of Equity)

Revenues

Expenses

400 Service Revenue

500 Utility Expense

510 Advertising Expense

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Most popular questions from this chapter

Question:Preparing financial statements from the trial balance and calculating the debt ratio

The trial balance as of July 31, 2018, for Sara Simon, Registered Dietician, is presented below:

Account Title Debit Credit

Office Supplies 2,300

Cash 38,000

Accounts Receivable 9,000

Prepaid Insurance 2,400

Equipment 16,000

Accounts Payable 3,000

Unearned Revenue 3,912

Notes Payable 31,000

Common Stock 18,000

Dividends 2,800

Salaries Expense 1,700

Rent Expense 1,100

Utilities Expense 500

Service Revenue 17,888

Total Balance \( 73,800 \) 73,800

Requirements 1. Prepare the income statement for the month ended July 31, 2018.

Question: The following transactions occurred for Wilke Technology Solutions:

May 1 The business received cash of \(105,000 and issued common stock to Zoe Wilke.

2 Purchased office supplies on account, \)550.

4 Paid \(57,000 cash for building and land. The building had a fair market value of \)45,000.

6 Performed services for customers and received cash, \(3,600.

9 Paid \)350 on accounts payable.

17 Performed services for customers on account, \(3,500.

19 Paid rent expense for the month, \)1,200.

20 Received \(1,500 from customers for services to be performed next month.

21 Paid \)900 for advertising in next month’s IT Technology magazine.

23 Received \(3,100 cash on account from a customer.

31 Incurred and paid salaries, \)1,700.

Analyzing and journalizing transactions

Journalize the transactions of Wilke Technology Solutions. Include an explanation with each journal entry. Use the following accounts: Cash; Accounts Receivable; Office Supplies; Prepaid Advertising; Land; Building; Accounts Payable; Unearned Revenue; Common Stock; Service Revenue; Rent Expense; and Salaries Expense

Before you begin this assignment, review the Tying It All Together feature in the chapter. Part of the Fry’s Electronics, Inc.’s experience involves providing technical support to its customers. This includes in-home installations of electronics and also computer support at their retail store locations.

Requirements

2. Assume Fry’s Electronics, Inc.’s Modesto, California, location received $24,000 for an annual contract to provide computer support to the local city government. How would Fry’s Electronics record this transaction? What financial statement(s) would this transaction affect?

What is a T-account? On which side is the debit? On which side is the credit? Where does the account name go on a T-account?

If total debits equal total credits on the trial balance, is the trial balance error-free? Explain your answer.
See all solutions

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