Accounting 504 Case Study 1

Case Solution
Req.1
Journal
DATE
June.

ACCOUNT TITLES
2 Cash...........................................................

DEBIT
55,000

Common Stock..............................

55,000

3 Supplies.................................................

3,000

Equipment.................................................

5,200

Accounts Payable.........................

4 Cash...................................................
Service Revenue...........................

CREDIT

8,200

6,300
6,300

7 Land...........................................................

37,000

Cash...............................................

11 Accounts Receivable............................

37,000

1,200

Service Revenue...............................

16 Accounts Payable.....................................

1,200

2,800

Cash...................................................

17 Utilities Expense.......................................

2,800

230

Cash...............................................

18 Cash.......................................................

230

700

Accounts Receivable....................

22

Utilities Expense.......................................

700

400

Cash...................................................

29

Cash...........................................................

400

5,000

Service Revenue...............................

30

Salary Expense.........................................

5,000

4,300

Cash...................................................

30

Dividends..................................................
Cash...................................................

4,300

3,000
3,00

Req. 2
Cash
Jun.

Accounts Receivable

55,000

Jun. 7

37,000

6,300

16

2,800

18

700

17

230

29

5,000

22

400

31

4,300

31

3,000

Bal.

19,270

Jun. 11
Bal.

1,200
500

Jun. 3

3,000

Bal.

3,000
Land

Jun. 3

5,200

Jun. 7

37,000

Bal.

5,200

Bal.

37,000

Accounts Payable
2,800 Jun.3
Bal.

700

Supplies

Equipment

Jun. 16

Jun. 18

Common Stock
8,200

Jun. 2

55,000

5,400

Bal.

55,000

Dividends

Service Revenue

Jun. 30

3,000

Jun. 4

6,300

Bal.

3,000

11

1,200

29

5,000

Bal.

Salary Expense
Jun. 30

4,300

Bal.

4,300

Req. 3

Utilities Expense
Jun. 17
22
Bal.

230
400
630

Gordon Construction, Inc.

Trial Balance
June 30, 2014
ACCOUNT

DEBIT

Cash............................................

$ 19,270

Accounts receivable..................

500

CREDIT

3,700

Supplies.....................................

3,000

Equipment..................................

5,200

Land............................................

37,000

Accounts payable......................

$
5,400

Common stock..........................

55,000

Dividends...................................

3,000

Service revenue.........................

12,500

Salary expense..........................

4,300

Utilities expense........................

630

Total............................................

$72,900

$72,900

Req.4
Total resources (assets) = $64,970 ($19,270 + $500 + $3,000 + $5,200 + $37,000)
Amount owed (total liabilities) = $5,400
Profit = $12,500 - $4,300 - $630= $7,570

Case Study 1 Solution Part B

Req.1
Adjusting Journal Entries
Journal
DATE
June

ACCOUNT TITLES

30 Accounts Receivable...............................

DEBIT
3,100

Service Revenue...........................

30 Supplies.................................................
Supplies Expense.........................

CREDIT

3,100

2,300
2,300

30 Salary Expense................................

3,660

Salary Payable...............................

3,660

Acct 504 Case Study 1 Solution Part B

Req. 2
Gordon Construction, Inc.
Adjusted Trial Balance
June 30, 2014

ACCOUNT TITLE

Cash
Accounts receivable
Supplies
Equipment
Land
Accounts payable
Salary Payable
Common Stock
Dividends
Service revenue

TRIAL BALANCE
DEBIT
CREDIT

19,270
500
3,000
5,200
37,000

(a) 3,100

5,400

3,000

ADJUSTMENTS
DEBIT
CREDIT

(b) 2,300

19,270
3,600
700
5,200
37,000

* 3,660

55,000
12,500

ADJUSTED
TRIAL BALANCE
DEBIT
CREDIT

3,000
(a) 3,100

5,400
3,660
55,000
15,600

Salary expense
Utilities expense
Supplies expense

4,300
630

72,900
*

$5,100 3/5 = $3,060

(c) 3,660

7,960
630
2,300

(b) 2,300

72,900

_____
9,060

_____
9,060

______
79,660

79,660