Holmes Cleaning Service began operation on January 1, 2018. The company experienced the following events...
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Accounting
Holmes Cleaning Service began operation on January 1, 2018. The company experienced the following events for its first year of operations:
Events Affecting 2018:
Provided $120,000 of cleaning services on account.
Collected $90,000 cash from accounts receivable.
Paid salaries of $40,000 for the year.
Adjusted the accounts to reflect managements expectations that uncollectible accounts expense would be $1,700. The expense was determined using the percent of revenue method.
Required
Organize the transaction data in accounts under an accounting equation.
Prepare an income statement, a balance sheet, and a statement of cash flows for 2018.
sign. If there is no effect on the Accounts Titles for Retained Earnings, leave the cell blank.) HOLMES CLEANING SERVICE Horizontal Statements Model Balance Sheet Assets Equity Accounts Retained Allowance Receivable Earnings Event Accounts Titles for Retained Earnings Cash 2018 1. + + Service revenue 120,000 (90,000) 2. 90,000 + (40,000) + 3. + 4. 1,700/= (40,000) Salaries expense (1,700) Uncollectible accounts expense (41,700) Bal. 50,000 + 30,000 1,700 =
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