The Accounting Cycle in Review

This assignment is out of 101 marks and is weighted 15% of your final grade. Comprehensive Question- Jerry’s Mobile Car Wash Jerry Fish opened Jerry’s Mobile Car Wash on Sept 1, 2017. In Sept, the following transactions were completed. Sept 1 Invested $14,000 cash in the business 1 Purchased a used truck for $26,400, paying $6,400 cash and signing a note payable for the balance 1 Collected $3,000 from XYZ for their car cleaning needs for Sept, Oct, and Nov. 3 Purchased cleaning supplies on account for $850 5 Paid $1,800 on a one-year insurance policy, effective Sept 1 12 Billed customers $3,800 for cleaning services 18 Paid $400 of amount owed on cleaning supplies 20 Paid $1,600 for employee's salaries 21 Collected $1,400 from customers billed on Sept 12 25 Billed customers for $3,000 for cleaning services 30 Paid gas and oil for the month on the truck $350 30 Withdrew $1,600 to pay personal property taxes Additional Information: 1. Annual payments of $2,000 are required on the note. Required: 1. Journalize and post the Sept transactions. Jerry;s Mobile Car Wash records all prepaid expenses and unearned revenues as assets and liabilities 2. Prepare an unadjusted trial balance at Sept 30, 2017. 3. Journalize and post the following adjustments a. Earned and unbilled fees at Sept 30, 2017 were $1,500. b. The truck has an estimated useful life of four years and no residual value. c. The insurance policy is effective Sept 1, 2017 and expires on August 31, 2018 d. An inventory count shows $375 of cleaning supplies on hand at Sept 30, 2017. e. At Sept 30, 2017, $1,000 of the fees collected in advance have been earned. f. Accrued but unpaid employee salaries were $400. g. The note payable has a 6% annual interest rate. 4. Prepare an adjusted trial balance at Sept 30, 2017. 5. Prepare in good form an Income Statement, Statement of Owner’s Equity and a Classified Balance Sheet for the month ended Sept 30, 2017. 6. Journalize and post the closing entries. 7. Prepare a post closing trial balance at Sept 30, 2017. 8. Jerry’s Mobile Car Wash has chosen to prepare reversing entries. Prepare necessary reversing entries in October 2017. They do not need to be posted.