Listed below are the transactions for Hunter Marketing, Inc. for the month of July:
|July 1||Hunter begins his marketing company and invests $50,000 cash.|
|July 5||Purchases computers and office equipment on account from OfficeMax for $10,250.|
|July 6||Pays rent for office space $800 for the month.|
|July 6||Employs a secretary, Mary Jones.|
|July 8||Purchases office supplies for cash at $960.|
|July 9||Receives $2,430 from customer for services performed.|
|July 11||Pays miscellaneous office expenses $375.|
|July 13||Bills customers $4,900 for services performed.|
|July 15||Pays Office Max $3,500 on account.|
|July 18||Withdraws $2,000 from business for personal use.|
|July 20||Hunter appeared on the cover of a local newsmagazine. Related article extolled Hunter’s expertise as well as the new company’s values and customer service that it brings to companies in the community. This exposure led to increased inquiries from prospective clients, and Hunter hopes this will increase future sales.|
|July 20||Receives $1,900 from customers on account.|
|July 23||Bills customers $6,320 for services performed.|
|July 30||Pays the following expenses in cash: office salaries $2,300 and utilities $400.|
Use the transactions to complete the following tasks:
- Enter the transactions shown above in appropriate general ledger accounts (use T-accounts). Use the following ledger accounts: Cash, Accounts Receivable, Supplies on Hand, Office Equipment, Accumulated Depreciation, Accounts Payable, Hunter-Capital, Service Revenue, Rent Expense, Miscellaneous Office Expense, Office Salaries Expense, Supplies Expense, Utilities Expense, Depreciation Expense and Income Summary.
- Prepare an unadjusted trial balance.
- Record depreciation using a five-year life on the office equipment, the straight-line method, and no salvage value. Round to whole numbers. Also, record an adjustment for office supplies used in the amount of $510.
- Prepare an adjusted trial balance.
- Prepare an income statement, a statement of retained earnings, and an unclassified balance sheet.
- Close the ledger.
- Prepare a post-closing trial balance.
- Which transaction do you think had the most significant economic impact on the Company? Why are economically relevant events not recorded in the financial records?