Trial Balances and Petty Cash

FREEMAN COMPANY
Work Sheet
For the Year Ended December 31, 2003

Income Statement Balance Sheet
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Accounts Debit Credit Debit Credit
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Cash 20,700
Accounts Receivable 4,000
Prepaid Insurance 7,000
Supplies 4,500
Equipment 48,000
Accumulated Depreciation 4,800
Patents 7,500
Accounts Payable 22,000
Bonds Payable 18,000
Common Stock 30,000
Retained Earnings 16,000
Dividends 3,500
Service Revenue 23,400
Salaries Expense 5,700
Depreciation Expense 4,800
Insurance Expense 5,000
Interest Expense 3,500
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Totals 19,000 23,400 95,200 90,800
Net Income 4,400 4,400
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23,400 23,400 95,200 95,200

INSTRUCTIONS
Prepare a classified balance sheet for Freeman Company.

COLLINS INSURANCE AGENCY
Income Statement
For the Month Ended June 30
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Revenues
Premium Commission Revenue ....................... $30,000
Expenses
Salary expense ................................... $7,000
Advertising expense .............................. 800
Rent expense ..................................... 4,200
Depreciation expense ............................. 2,800
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Total expenses ................................. 14,800
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Net income ......................................... $15,200

Additional Data: When the income statement was prepared, the
company accountant neglected to take into consideration the
following information:

1. A utility bill for $2,000 was received on the last day of the
month for electric and gas service for the month of June.

2. A company insurance salesman sold a life insurance policy to a
client for a premium of $25,000. The agency billed the client
for the policy and is entitled to a commission of 20%.

3. Supplies on hand at the beginning of the month were $3,000. The
agency purchased additional supplies during the month for $2,500
in cash and $2,200 of supplies were on hand at June 30.

4. The agency purchased a new car at the beginning of the month for
$19,200 cash. The car will depreciate $4,800 per year.

5. Salaries owed to employees at the end of the month total $5,500.
The salaries will be paid on July 5.

INSTRUCTIONS
Prepare a correct income statement.

The adjusted trial balance of the Nelson Music Company appears below.
Nelson Music Company prepares monthly financial statements and uses
the perpetual inventory method.

INSTRUCTIONS
Complete the work sheet below.

NELSON MUSIC COMPANY
Work sheet
For the Month Ended April 30, 2007

Adjusted
Trial Balance Income Statement Balance Sheet
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Debit Credit Debit Credit Debit Credit
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Cash 15,000
Supplies 3,500
Merch Inv. 17,000
Equipment 85,000
Accum. Deprec.??
Equipment 15,000
Accounts Payabl e 15,000
Common Stock 80,000
Retained Earnings 17,000
Dividends 5,000
Sales 48,000
Sales Discounts 2,000
Cost of Gds. Sold 30,000
Advertising Exp. 7,000
Supplies Expense 6,000
Deprec. Expense 1,000
Rent Expense 2,500
Utility Expense 1,000
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175,000 175,000

On October 1, 2000, Harris Company establishes an imprest petty cash
fund by issuing a check for $150 to Anika Collette, the custodian of the
petty cash fund. On October 31, 2000, Anika Collette submitted the
following paid petty cash receipts for replenishment of the petty
cash fund when there is $4 cash in the fund:

Freight-in $26
Office Supplies Expense 35
Entertainment of Clients 60
Postage Expense 20

INSTRUCTIONS
Prepare the journal entries required to establish the petty cash
fund on October 1 and the replenishment of the fund on October 31.

Andy Delduca and Associates is a financial planning service. The
account balances at December 31, 2007 are shown by the following
alphabetical list:

Accounts Payable $ 10,000
Accounts Receivable 21,000
Automobiles 27,500
Building 120,000
Cash 20,500
Common Stock 184,700
Computer 28,000
Computer Software 4,200
Land 42,000
Notes Payable 95,000
Notes Receivable 8,100
Office Furniture 15,400
Office Supplies 800
Technical Library 2,200

INSTRUCTIONS
Prepare a trial balance with the accounts arranged in financial
statement order.