Maquoketa Services was formed on May 1, 2019. The following transactions took place during the first month. Transactions on May: Jay Bradford invested $40,000 cash in the company, as its sole owner....

Maquoketa Services was formed on May 1, 2019. The following transactions took place during the first month. Transactions on May:

1. Jay Bradford invested $40,000 cash in the company, as its sole owner.


2. Hired two employees to work in the warehouse. They will each be paid a salary of $3,050 per month. 3. Signed a 2-year rental agreement on a warehouse; paid $24,000 cash in advance for the first year.


3. Purchased furniture and equipment costing $30,000. A cash payment of $10,000 was made immediately; the remainder will be paid in 6 months.


4. Paid $1,800 cash for a one-year insurance policy on the furniture and equipment.


5. Purchased basic office supplies for $2420 cash.


6. Purchased more office supplies for $1,500 on account.


7. Total revenues earned were $20,000—$8,000 cash and $12,000 on account.


8. Paid $400 to suppliers for accounts payable due.


9. Received $3,000 from customers in payment of accounts receivable.


10. Received utility bills in the amount of $380, to be paid next month.


11. Paid the monthly salaries of the two employees, totaling $6,100Instructions:

(a) Journalize and post the May transactions.

(b) Prepare a trial balance at May 31.

(c) Enter the following adjustments.

(1) Unbilled and uncollected revenue for services performed at May 31 were $2,700.

(2) Depreciation on equipment for the month was $500.

(3) One-twelfth of the insurance expired.

(4) An inventory count shows $600 of cleaning supplies on hand at May 31.

(5) Accrued but unpaid employee salaries were $1,000.

(d) Prepare adjusted trial balance

(e) Prepare the income statement and owner’s equity statement for May and a balance sheet at May 31.