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.
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.