Accounting Test Question No 1. On The Recording Process

Mr X opened X Company which engaged in consultancy business. Append below the transactions during March 2007:

Mar 1. Commence business by investing $25,000 cash and office equipment which is valued at $5,000

Mar 3. Bought $2,300 for office supplies on credit.

Mar 10 Have invoiced Company ABC for completed consultancy work of $3,100 of which $2,100 cash was received and the remaining still outstanding.

Mar 11. Paid $1,500 for the supplies purchased on Jan 3.

Mar 15. Paid for the annual premium on insurance policy for $850

Mar 20. Received cash on the outstanding sum of $1,100 from Company ABC for the work completed on Mar 10

Mar 25. Mr X withdrew $500 cash from the business for his personal use.

Mar 29. Paid $200 cash for utility bills.

Mar 29. Received $1,500 cash in advance being consulting services to be rendered in April.

Mar 31. Have ascertained that the cost of supplies on hand was $550

Required:

1. Journalize the transactions for March 2007
2. Post the journal entries to the three columns ledger
3. Prepare the trial balance as at 31 March 2007

[Refer Answer]