Tony’s Personal Training Service (TPTS) has been in business for several years. He presents you with the following accounts and their balances at 1st…

Tony’s Personal Training Service (TPTS) has been in business for several years. He presents you with the following accounts and their balances at 1st March, 2018:

Cash at Bank 68000 Training Equipment $44400

Accounts Receivable 18800 Land 240000

Prepaid Insurance 6000 Buildings 125000

Capital ? Drawings 4000

Service Fee Revenue 110000 Supplies Expense 28000

Wages Expense 41000 Loan Payable 50000

Accounts Payable 9200 Promotion Expenses 6600

Unearned Revenue 0

During March the business had the following transactions. Note where relevant all figures are GST inclusive:

Mar 1 Owner invested additional $10000 into the business

5 Purchases more training equipment $8800. Paid $4800 in cash, and increased Loan Payable for the balance.

8 Paid promotion expenses $330

10 Received fees in advance of $5500 for contract work to be delivered in June, 2018

15 Receive Service Fee Revenue in cash for the first half of the month $22000.

20 Paid Accounts Payable 9200

22 Bought supplies on credit $2200

24 Received $12800 from accounts receivable

26 Owner withdrew $6000 from the business for personal use

28 Paid Wages for the month $9000

30 Recorded service fee revenue for the second half of the month $15400. $1400 was received in cash the balance on credit.

Required:

A. Draw up the ledger of TPTS and enter the balances at the beginning of March after calculating the Capital Balance.

B. Enter the entries March 1 to 30 in the General Journal

C. Post the entries from the journal to the ledger accounts

D. Complete the Trial Balance as at 31st March, 2018

E. Can Tony assume that because the Trial Balance balances that the books for the business are correct? Give three reasons for your answer.

Order the answer to view it

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