Practice Problems
Complete these practice problems. Check your answers after you finish.
Demonstration problem
This problem involves using a work sheet for Green Hills Riding Stable, Incorporated, for the month ended 2010 July 31, and performing the closing process. The trial balance for Green Hills Riding Stable, Incorporated, as of 2010 July 31, was as follows:
GREEN HILLS RIDING STABLE, INCORPORATED
Trial Balance
2010 July 31
| Acct. No. |
Account Title | Debits | Credits |
| 100 | Cash | $ 10,700 | |
| 103 | Accounts Receivable | 8,100 | |
| 130 | Land | 40,000 | |
| 140 | Buildings | 24,000 | |
| 200 | Accounts Payable | $ 1,100 | |
| 201 | Notes Payable | 40,000 | |
| 300 | Capital Stock | 35,000 | |
| 310 | Retained Earnings, 2010 July 1 | 3,100 | |
| 320 | Dividends | 1,000 | |
| 402 | Horse Boarding Fees Revenue | 4,500 | |
| 404 | Riding Lesson Fees Revenue | 3,600 | |
| 507 | Salaries Expense | 1,400 | |
| 513 | Feed Expense | 1,100 | |
| 540 | Interest Expense | 200 | |
| 568 | Miscellaneous Expense | 800 | |
| $ 87,300 | 87,300 |
Depreciation expense for the month is USD 200. Accrued salaries on July 31 are USD 300.
a. Prepare a 12-column work sheet for the month ended 2010 July 31.
b. Journalize the adjusting entries.
c. Journalize the closing entries.
Source: Textbook Equity, https://learn.saylor.org/pluginfile.php/41229/mod_resource/content/8/AccountingPrinciples.pdf
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