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On January 1 Pulse Recording Studio Prs Had The Following

1. Pulse Recording Studio (PRS) began January with various account balances. During the month they received payments from customers, paid expenses, and purchased supplies. 2. PRS completed various recording sessions that were paid for in advance or during January. They also paid employee salaries and received additional payments from customers for future sessions. 3. A bank reconciliation completed at the end of January revealed discrepancies including a returned check, outstanding deposits and payments, as well as bank charges and interest that required adjusting entries.

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175 views1 page

On January 1 Pulse Recording Studio Prs Had The Following

1. Pulse Recording Studio (PRS) began January with various account balances. During the month they received payments from customers, paid expenses, and purchased supplies. 2. PRS completed various recording sessions that were paid for in advance or during January. They also paid employee salaries and received additional payments from customers for future sessions. 3. A bank reconciliation completed at the end of January revealed discrepancies including a returned check, outstanding deposits and payments, as well as bank charges and interest that required adjusting entries.

Uploaded by

Let's Talk With Hassan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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On January 1 Pulse Recording Studio PRS had the

following #2726
On January 1, Pulse Recording Studio (PRS) had the following account balances.The following
transactions occurred during January.1. Received $ 2,500 cash on 1/ 1 from customers on
account for recording services completed in December.2. Wrote checks on 1/ 2 totaling $ 4,000
for amounts owed on account at the end of December.3. Purchased and received supplies on
account on 1/ 3, at a total cost of $ 200.4. Completed $ 4,000 of recording sessions on 1/ 4 that
customers had paid for in advance in December.5. Received $ 5,000 cash on 1/ 5 from
customers for recording sessions started and completed in January.6. Wrote a check on 1/ 6 for
$ 4,000 for an amount owed on account.7. Converted $ 1,000 of cash equivalents into cash on
1/ 7.8. On 1/ 15, completed EFTs for $ 1,500 for employees’ salaries and wages for the first
half of January.9. Received $ 3,000 cash on 1/ 31 from customers for recording sessions to
start in February.Required:1. Prepare journal entries for the January transactions.2. Enter the
January 1 balances into T- accounts, post the journal entries from requirement 1, and calculate
January 31 balances. (If you are completing this requirement in Connect, this requirement will
be completed for you.)3. Use the January 31 balance in Cash from requirement 2 and the
following information to pre-pare a bank reconciliation. PRS’s bank reported a January 31
balance of $ 6,300. 10. The bank deducted $ 500 for an NSF check from a customer deposited
on January 5. 11. The check written January 6 has not cleared the bank, but the January 2
payment has cleared.12. The cash received and deposited on January 31 was not processed
by the bank until February 1.13. The bank added $ 5 cash to the account for interest earned in
January.14. The bank deducted $ 5 for service charges.4. Prepare journal entries for items
(10)–(14) from the bank reconciliation, if applicable, and post them to the T- accounts. If a
journal entry is not Required. for one or more of the reconciling items, indicate “no journal entry
required.”(If you are using Connect, journal entries will be automatically posted after you enter
them.)5. Prepare adjusting journal entries on 1/ 31, using the following information.15.
Depreciation for the month is $ 200.16. Salaries and wages totaling $ 1,500 have not yet been
recorded for January 16– 31. 17. Prepaid Rent will be fully used up by March 31.18. Supplies on
hand at January 31 were $ 500.19. Received $ 600 invoice for January electricity charged on
account to be paid in February but is not yet recorded.20. Interest on the promissory note of $
60 for January has not yet been recorded or paid. 21. Income tax of $ 1,000 on January income
has not yet been recorded or paid.6. Post the adjusting journal entries from requirement 5 to the
T- accounts and prepare an adjusted trial balance. (If you are completing this requirement in
Connect, it will be completed for you using your previous answers.)7. Prepare an income
statement for January and a classified balance sheet at January 31. Report PRS’s cash and
cash equivalents as a single line on the balance sheet.8. Calculate the current ratio at January
31 and indicate whether PRS has met its loan covenant that requires a minimum current ratio of
1.2.9. Calculate the net profit margin and indicate whether PRS has achieved its objective of 10
percent.View Solution:
On January 1 Pulse Recording Studio PRS had the following

ANSWER
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