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Problem 1

The document describes the events that occurred for Creative Advertising during January 2011, including contributions, purchases, payments, billings, and receipts. It requires passing journal entries for these events and creating a trial balance.

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Karl William Sorima
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3K views

Problem 1

The document describes the events that occurred for Creative Advertising during January 2011, including contributions, purchases, payments, billings, and receipts. It requires passing journal entries for these events and creating a trial balance.

Uploaded by

Karl William Sorima
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Problem 1:

Creative Advertising, owned by Miss Abida Masood, provides advertising consulting


services. During January 2011, the following events occurred:

Jan. 2 Owner contributed Rs. 50,000 and a new computer costing Rs. 20,500 to start
her business.
Jan. 4 Office supplies were purchased on account for Rs. 4,000.
Jan. 10 Creative Advertising obtained 12% 5-year loan of Rs. 20,000 from the bank.
Jan. 12 Creative Advertising paid the utility bills for Rs. 2,750.
Jan. 15 Paid the Rs. 3,000 in Accounts Payable from the purchase of office supplies
on Jan. 4.
Jan. 24 Advertising services completed in January were billed to clients Annies’
Flowers at Rs. 18,300.
Jan. 27 Creative Advertising received Rs. 5,500 from Annies’ Flowers, a client, as
payment on account.
Jan. 30 Miss Abida Masood withdrew Rs. 6,000 of cash for personal use.

Requirement: You are required to pass Journal Entry, post to appropriate general
ledger account and make a trial balance.

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