On November 1, 2016, Patty Cosgrove established an interior decorating business

| March 29, 2017

Question
On November 1, 2016, Patty Cosgrove established an interior decorating business, Classic Designs. During the month, Patty completed the following transactions related to the business:

Nov. 1 Patty transferred cash from a personal bank account to an account to be used for the business, $27,250.
1 Paid rent for period of November 1 to end of month, $3,100.
6 Purchased office equipment on account, $12,700.
8 Purchased a truck for $31,450 paying $6,300 cash and giving a note payable for the remainder.
10 Purchased supplies for cash, $1,660.
12 Received cash for job completed, $9,000.
15 Paid annual premiums on property and casualty insurance, $2,500.
23 Recorded jobs completed on account and sent invoices to customers, $12,440.
24 Received an invoice for truck expenses, to be paid in November, $1,390.
Enter the following transactions on Page 2 of the two-column journal:

Nov. 29 Paid utilities expense, $3,660.
29 Paid miscellaneous expenses, $1,580.
30 Received cash from customers on account, $8,200.
30 Paid wages of employees, $4,600.
30 Paid creditor a portion of the amount owed for equipment purchased on November 6, $6,160.
30 Withdrew cash for personal use, $2,100.
Required:
1. Journalize each transaction in a two-column journal beginning on Page 1, referring to the chart of accounts in selecting the accounts to be debited and credited. (Do not insert the post reference numbers until you have posted the entry to the general ledger in part 2.)
2. Post (in chronological order) the journal to a ledger of four-column accounts, inserting appropriate posting references in both the journal and the ledger as each item is posted. Extend the balances to the appropriate balance columns after each transaction is posted.
3. Prepare an unadjusted trial balance for Classic Designs as of November 30, 2016.
4. Determine the excess of revenues over expenses for November.

Chart of Accounts

CHART OF ACCOUNTS
Classic Designs
General Ledger
ASSETS
11 Cash
12 Accounts Receivable
13 Supplies
14 Prepaid Insurance
16 Equipment
18 Truck
LIABILITIES
21 Notes Payable
22 Accounts Payable
EQUITY
31 Patty Cosgrove, Capital
32 Patty Cosgrove, Drawing
REVENUE
41 Fees Earned
EXPENSES
51 Wages Expense
53 Rent Expense
54 Utilities Expense
55 Truck Expense
59 Miscellaneous Expense

Journal

1. Journalize each transaction in a two-column journal beginning on Page 1, referring to the chart of accounts in selecting the accounts to be debited and credited. (Do not insert the post reference numbers until you have posted the entry to the general ledger in part 2.) PAGE 1 JOURNAL
1
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PAGE 2
JOURNAL
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