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(solution) Question1 Identify each account as an asset (A), liability (L),


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Question1

 

Identify each account as an asset (A), liability (L), or equity (E).

 

a. Notes Receivable

 

b. New, Captial

 

c. Prepaid

 

Insurance

 

d. Notes Payable

 

e. Rent Revenue

 

f. Taxes Payable

 

g. Rent Expense

 

h. Furniture

 

i. New, Withdrawals

 

j. Unearned

 

Revenue 0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0 Question2

 

For each account, identify whether the normal balance is a debit (DR) or credit (CR)

 

a. Notes Payable

 

b. Hernandez, Withdrawals

 

c. Service Revenue

 

d. Land

 

e. Unearned Revenue

 

f. Hernandez, Capital

 

g. Utilities Expense

 

h. Office Supplies

 

i. Advertising Expense

 

j. Interest Payable 0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0 Question3

 

Amazing Sales Consultants completed the following transactions during the latter part of January:

 

(Click the icon to view the transactions.)

 

Jan. 22

 

30

 

31

 

31

 

31

 

31 Performed services for customers on account, $7,500.

 

Received cash on account from customers, $7,000.

 

Received a utility bill, $200, which will be paid during February.

 

Paid monthly salary to salesman, $2,000.

 

Received $1,350 for three months of consulting service to be performed

 

starting in February.

 

The owner, Declan Wilson, withdrew $1,100 from the business. Journalize the transactions of Amazing Sales Consultants. Include an explanation with each journal entry.

 

(Record debits first, then credits. Select the explanation on the last line of the journal entry table.)

 

Jan 22: Amazing Sales Consultants performed services for customers on account, $7,500.

 

Date Jan. 22 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Debit Credit Jan 30: Amazing Sales Consultants received cash on account from customers, $7,000.

 

Date Jan. 30 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Debit Credit Jan 31: Amazing Sales Consultants received a utility bill, $200, which will be paid during February

 

Date Jan. 31 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Debit Credit Jan 31: Amazing Sales Consultants paid monthly salary to salesman, $2,000.

 

Date Accounts

 

and

 

Explanatio

 

n Debit Credit Jan. 31 0

 

0

 

0

 

0

 

0 Jan 31: Amazing Sales Consultants received $ 1 comma 350$1,350 for three months of consulting service

 

to be performed starting in February

 

Date Jan. 31 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Debit Credit Jan 31: Amazing Sales Consultants' owner, Declan Wilson, withdrew $1 comma 1001,100 from the

 

business.

 

Date Jan. 31 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Debit Credit Question4

 

he T-accounts of Markis Farm Equipment Repair follow as of May 31, 2016.

 

(Click the icon to view the T-accounts.) Prepare Markis Farm Equipment Repair's trial balance as of May 31, 2016.

 

Markis Farm Equipment Repair

 

Trial Balance

 

May 31 2016

 

Account

 

Title

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Total Balance

 

Debit Credit Question5

 

he trial balance as of July 31, 2017, for Sarah Silk, Registered Dietician, is presented below:

 

(Click the icon to view the trial balance.)

 

Sarah Silk, Registered Dietician

 

Trial Balance

 

31-Jul17

 

Balance

 

Account Title

 

Debit Credit Cash

 

Accounts

 

Receivable

 

Office Supplies

 

Prepaid Insurance

 

Equipment

 

Accounts Payable

 

Unearned Revenue

 

Notes Payable

 

Silk, Capital

 

Silk, Withdrawals

 

Service Revenue

 

Salaries Expense

 

Rent Expense

 

Utilities Expense

 

Total $30,00

 

0

 

9,700

 

2,200

 

2,700

 

20,000

 

$3,400

 

5,192

 

25,000

 

26,000

 

2,500

 

9,858

 

1,300

 

800

 

250

 

$69,45

 

0 $69,45

 

0 Read the requirements

 

1. Prepare the income statement for the month ended July 31, 2017.

 

2. Prepare the statement of owner's equity for the month ended July 31, 2017. The beginning balance of

 

capital was $0 and the owner contributed $26,000 during the month.

 

3. Prepare the balance sheet as of July 31, 2017.

 

4. Calculate the debt ratio as of July 31, 2017.

 

Requirement 1. Prepare the income statement for the month ended July 31, 2017. (If a box is not used in

 

the statement, leave the box empty; do not select a label or enter a zero.)

 

Sarah Silk, Registered

 

Dietician

 

Income Statement

 

Month Ended July 31, 2017

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Net Income Requirement 2. Prepare the statement of owner's equity for the month ended July 31, 2017. The

 

beginning balance of capital was $0 and the owner contributed $26,000 during the month. (Complete all

 

answer boxes. Enter a "0" for any zero balances. Use a minus sign or parentheses to show a decrease in

 

capital.)

 

Sarah Silk, Registered

 

Dietician

 

Statement of Owner's Equity

 

Month Ended July 31, 2017

 

Silk, Capital, July 1, 2017

 

0

 

0

 

0

 

Silk, Capital, July 31, 2017

 

Requirement 3. Prepare the balance sheet as of July 31, 2017. (If a box is not used in the statement,

 

leave the box empty; do not select a label or enter a zero.)

 

Sarah Silk, Registered Dietician

 

Balance Sheet

 

31-Jul-17

 

Assets

 

0

 

0

 

0

 

0

 

0 Liabilities

 

0

 

0

 

0

 

0

 

Owner's

 

Equity

 

0

 

0 0

 

0 Requirement 4. Calculate the debt ratio as of July 31, 2017. Select the debt ratio formula on the first line

 

and then calculate the ratio.??

 

0 /

 

/ 0 =

 

= Debt ratio

 

% Question6

 

Raymond Autobody Shop has the following accounts:

 

(Click the icon to view the accounts.) Accounts Payable Service Revenue Cash Equipment Utilities Expense Raymond, Capital Automotive Supplies Advertising Expense Raymond, Withdrawals Unearned Revenue Create a chart of accounts for Raymond Autobody Shop using the standard numbering system. Each

 

account is separated by a factor of 10. For example, the first asset account will be 100 and the next asset

 

account will 110. (Use the first available line under each section, Asset, Liabilities, etc., when selecting

 

the accounts. If a box is not used, leave the box empty; do not select any labels.)

 

Balance Sheet Accounts

 

Assets

 

0

 

0

 

0

 

0

 

0

 

0 Liabilities

 

Equity

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Income Statement

 

Accounts

 

(Part of

 

Equity)

 

Revenues

 

Expense

 

s

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0 0

 

0

 

0 0

 

0

 

0 Question7

 

Accounts Payable

 

2-May

 

8,000

 

22-May

 

11,000 15,000

 

1-May

 

500

 

5-May

 

6,500

 

15-May

 

250

 

23-May

 

Calculate the Accounts Payable balance. (Enter the balanace, along with a "Bal." reference on the correct

 

side of the T-account.)

 

Accounts Payable

 

2-May

 

8,000

 

22-May

 

11,000 0

 

Question8 15,000

 

500

 

6,500

 

250 1-May

 

5-May

 

15-May

 

23-May

 

0 Consider the following accounts:

 

(Click the icon to view the accounts.)

 

a.

 

b.

 

c.

 

d.

 

e.

 

f.

 

g.

 

h.

 

i.

 

j. Interest Revenue

 

Accounts Payable

 

Curtis, Capital

 

Office Supplies

 

Advertising

 

Expense

 

Unearned

 

Revenue

 

Prepaid Rent

 

Utilities Expense

 

Curtis,

 

Withdrawals

 

Service Revenue Requirements

 

1. Identify each account as an asset (A), liability (L), or equity (E).

 

2. Identify whether the account is increased with a debit (DR) or credit (CR).

 

3. Identify whether the normal balance is a debit (DR) or credit (CR). a.

 

b.

 

c.

 

d.

 

e.

 

f.

 

g.

 

h.

 

i.

 

j. Interest Revenue

 

Accounts Payable

 

Curtis, Capital

 

Office Supplies

 

Advertising Expense

 

Unearned Revenue

 

Prepaid Rent

 

Utilities Expense

 

Curtis, Withdrawals

 

Service Revenue Requirement 2.

 

Increases with a

 

debit (DR) or credit (CR)?

 

0 Requirement 1.

 

Asset (A), Liability (L),

 

or Equity (E)?

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0 0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Requirement 3.

 

Normal balance is

 

a

 

debit (DR) or credit (CR)?

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Question9

 

In December 2016, the first five transactions of Amers' Automotive Company have been posted to the Taccounts. Prepare the journal entries that served as the sources for the five transactions. Include an

 

explanation for each entry.

 

(Click the icon to view the T-accounts.)

 

Accounts Payable Notes Payable

 

1,100 -2 Amers, Capita

 

42,000 -4 Prepare each transaction in order according to the reference number shown in the accounts provided.

 

(Record debits first, then credits. Select the explanation on the last line of the journal entry table.) (1) Accounts

 

and

 

Explanatio

 

n

 

0 Debit Credit 0

 

0

 

0

 

0

 

Debit Credit (2) Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Debit Credit (3) Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Debit Credit (4) Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0

 

Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0 Debit Credit (5) 0

 

0

 

Question10

 

Young practices medicine under the business title Victor Young, M.D.Victor Young, M.D. During July, the

 

medical practice completed the following transactions:

 

(Click the icon to view the transactions.)

 

1 Young contributed $69,000 cash to the business in exchange for capital.

 

5 Paid monthly rent on medical equipment, $560.

 

9 Paid $19,000 cash to purchase land to be used in operations.

 

10 Purchased office supplies on account, $2,000.

 

19 Borrowed $28,000 from the bank for business use.

 

22 Paid $1,600 on account.

 

28 The business received a bill for advertising in the daily newspaper to be paid in August, $240.

 

31 Revenues earned during the month included $7,000 cash and $5,800 on account.

 

31 Paid employees' salaries $2,100, office rent $1,200, and utilities $400. Record as a compound entry.

 

31 The business received $1,050 for medical screening services to be performed next month.

 

31 Young withdrew cash of $6,700.

 

The business uses the following accounts: Cash; Accounts Receivable; Office Supplies; Land; Accounts

 

Payable; Advertising Payable; Unearned Revenue; Notes Payable; Young, Capital; Young, Withdrawals;

 

Service Revenue; Salaries Expense; Rent Expense; Utilities Expense; and Advertising Expense.

 

Read the requirements

 

1. Journalize each transaction. Explanations are not required.

 

2. Post the journal entries to the T-accounts, using transaction dates as posting references in the ledger

 

accounts. Label the balance of each account Bal.

 

3. Prepare the trial balance of Victor Young comma M.D.Victor Young, M.D., as of July 31, 2017. Requirement 1. Journalize each transaction. Explanations are not required. (Record debits first, then

 

credits. Exclude explanations from journal entries.)

 

July 1: Young contributed $69,000 cash to the business in exchange for capital.

 

Date

 

Jul. 1 Account

 

s

 

0 Debit Credit 0

 

0

 

0

 

July 5: Paid monthly rent on medical equipment, $560.

 

Date

 

Jul. 5 Account

 

s

 

0

 

0

 

0

 

0 Debit Credit July 9: Paid $19,000 cash to purchase land to be used in operations.

 

Date

 

Jul. 9 Account

 

s

 

0

 

0

 

0

 

0 Debit Credit July 10: Purchased office supplies on account, $2,000.

 

Date

 

Jul. 10 Account

 

s

 

0

 

0

 

0

 

0 Debit Credit July 19: Borrowed $28,000 from the bank for business use.

 

Date

 

Jul. 19 Account

 

s

 

0

 

0

 

0

 

0 Debit Credit Account

 

s Debit Credit July 22: Paid $1,600 on account.

 

Date Jul. 22 0

 

0

 

0

 

0 July 28: The business received a bill for advertising in the daily newspaper to be paid in August, $240.

 

Date

 

Jul. 28 Account

 

s

 

0

 

0

 

0

 

0 Debit Credit July 31 (a): Revenues earned during the month included $7,000 cash and $5,800 on account. Record as a

 

compound entry.

 

Date

 

Jul. 31 Account

 

s

 

0

 

0

 

0

 

0 Debit Credit July 31 (b): Paid employees' salaries $2,100, office rent $1,200, and utilities $400. Record these entries as

 

a compound entry.

 

Date

 

Jul. 31 Account

 

s

 

0

 

0

 

0

 

0 Debit Credit July 31 (c): The business received $1,050 for medical screening services to be performed next month.

 

Date

 

Jul. 31 Account

 

s

 

0

 

0

 

0

 

0 July 31 (d): Young withdrew cash of $6,700. Debit Credit Date Account

 

s

 

0

 

0

 

0

 

0 Jul. 31 Debit Credit Requirement 2. Post the transactions to the T-accounts, using transaction dates as posting references in

 

the ledger accounts. Label the balance of each account Bal. (Identify the July 31 transactions as "a" - 'd"

 

as they are labeled in the journal entry tables.)

 

Cash

 

0

 

0

 

0

 

0 Accounts Payable

 

0

 

0 0

 

0

 

0

 

0 0

 

0

 

Accounts Receivable 0

 

0 0

 

0

 

0

 

Office Supplies

 

0

 

0

 

Land

 

0

 

0 0

 

0

 

0 Advertising

 

Payable

 

0

 

0

 

Unearned

 

Revenue

 

0

 

0

 

0

 

Notes Payable

 

0

 

0

 

Young, Capital

 

0

 

0

 

Young,

 

Withdrawals

 

0

 

0 0

 

0

 

0

 

0 0

 

0 Salaries Expen

 

0

 

0 0

 

0

 

Rent Expense 0

 

0

 

0 0

 

0

 

0

 

Utilities Expen

 

0

 

0

 

Advertising Ex

 

0

 

0 0

 

0

 

0

 

0 0

 

0 Requirement 3. Prepare the trial balance of Victor Young comma M.D.Victor Young, M.D., as of July 31,

 

2017.

 

Victor Young, M.D.

 

Trial Balance

 

31-Jul17

 

Account Balance

 

Debit Credit Service Reven

 

0

 

0 Title

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Total

 

Question11

 

Kelley Lunger has trouble keeping her debits and credits equal. During a recent month, Kelley made the

 

following accounting errors:

 

a. In preparing the trial balance, Kelley omitted a $2,000 Notes Payable. The debit to Cash was correct.

 

b. Kelley posted an $800 Utilities Expense as $80. The credit to Cash was correct.

 

c. In recording an $800 payment on account, Kelley debited Equipment instead of Accounts Payable.

 

d. In journalizing a receipt of cash for service revenue, Kelley debited Cash for $90 instead of the correct

 

amount of $900. The credit was correct.

 

e. Kelley recorded a $560 purchase of office supplies on account by debiting Office Supplies and crediting

 

Accounts Payable for $650.

 

Requirements

 

1. For each of these errors, state whether total debits equal total credits on the trial balance.

 

2. Identify each account that has an incorrect balance, and the amount and direction of the error (such

 

as "Accounts Receivable $500 too high").

 

Requirement 1. For each of these errors, state whether total debits equal total credits on the trial

 

balance. For each error determine whether total debits are "Greater than" (>), "Equal to" (=), or "Less

 

than" (<) total credits.

 

a. Total

 

debits Total

 

credits b.

 

c.

 

d.

 

e. Total

 

debits

 

Total

 

debits

 

Total

 

debits

 

Total

 

debits Total

 

credits

 

Total

 

credits

 

Total

 

credits

 

Total

 

credits Requirement 2. Identify each account that has an incorrect balance, and the amount and direction of

 

the error (such as "Accounts Receivable $500 too high").

 

Account Amount Direction of Error a.

 

b.

 

c.

 

d.

 

e.

 

The accountant for Town and Country Painting Specialists is having a hard time preparing the trial

 

balance as of November 30, 2016:

 

(Click the icon to view the trial balance.)

 

Town and Country Painting Specialists

 

Trial Balance

 

30-Nov-16

 

Balance

 

Debit

 

$13,000 Account Title

 

Painting

 

Equipment

 

Cash

 

12,900

 

Accounts

 

1,100

 

Receivable

 

Advertising

 

450

 

Expense

 

Wilson, Withdrawals

 

Accounts Payable

 

Rent Expense

 

2,700

 

Wilson, Capital

 

15,000

 

Service Revenue

 

Unearned

 

2,000

 

Revenue

 

Salaries Expense

 

2,100

 

Office Supplies Credit $7,000

 

3,100 19,650 300 Utilities Expense

 

Total 200

 

$49,450 $30,050 Prepare the corrected trial balance as of November 30, 2016. Assume all amounts are correct and all

 

accounts have normal balances.

 

Town and Country Painting Specialists

 

Trial Balance

 

30-Nov-16

 

Account

 

Title

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Total Balance

 

Debit Credit Question13

 

Terrence Murphy opened a law office on January 1, 2017. During the first month of operations, the

 

business completed the following transactions:

 

(Click the icon to view the transactions.)

 

January

 

1 Murphy contributed $79,000 cash to the business, Terrence Murphy, Attorney. The business gave

 

capital to Murphy.

 

3 Purchased office supplies, $400, and furniture, $1,300, on account.

 

4 Performed legal services for a client and received $1,500 cash.

 

7 Purchased a building with a market value of $140,000, and land with a market value of $25,000. The

 

business paid $70,000 cash and signed a note payable to the bank for the remaining amount.

 

11 Prepared legal documents for a client on account, $1,000. 15 Paid assistant's semimonthly salary, $1,150.

 

16 Paid for the office supplies purchased on January 3 on account.

 

18 Received $2,100 cash for helping a client sell real estate.

 

19 Defended a client in court and billed the client for $600.

 

25 Received a bill for utilities, $250. The bill will be paid next month.

 

29 Received cash on account, $1,000.

 

30 Paid $1,200 cash for a 12-month insurance policy starting on February 1.

 

30 Paid assistant's semimonthly salary, $1,150.

 

31 Paid monthly rent expense, $1,900.

 

31 Murphy withdrew cash of $2,500.

 

Read the requirements

 

1. Record each transaction in the journal, using the following account titles: Cash; Accounts Receivable;

 

Office Supplies; Prepaid Insurance; Furniture; Building; Land; Accounts Payable; Utilities Payable; Notes

 

Payable; Murphy, Capital; Murphy, Withdrawals; Service Revenue; Salaries Expense; Rent Expense; and

 

Utilities Expense. Explanations are not required.

 

2. The following four-column accounts have been opened for each of the accounts. Cash, 101; Accounts

 

Receivable, 111; Office Supplies, 121; Prepaid Insurance, 131; Furniture, 141; Building, 151; Land, 161;

 

Accounts Payable, 201; Utilities Payable, 211; Notes Payable, 221; Murphy, Capital, 301; Murphy,

 

Withdrawals, 311; Service Revenue, 411; Salaries Expense, 511; Rent Expense, 521; and Utilities

 

Expense, 531. Post the journal entries to four-column accounts in the ledger, using dates, account

 

numbers, journal references, and posting references. Assume the journal entries were recorded on page

 

1 of the journal.

 

3. Prepare the trial balance of Terrence Murphy, Attorney, at January 31, 2017.

 

Requirement 1.

 

Record each transaction in the journal, using the following account titles: Cash; Accounts Receivable;

 

Office Supplies; Prepaid Insurance; Furniture; Building; Land; Accounts Payable; Utilities Payable; Notes

 

Payable; Murphy, Capital; Murphy, Withdrawals; Service Revenue; Salaries Expense; Rent Expense; and

 

Utilities Expense. Explanations are not required. (Record debits first, then credits. Exclude explanations

 

from journal entries.)

 

Jan. 1: Murphy contributed $79,000 cash to the business, Terrence Murphy, Attorney. The business gave

 

capital to Murphy.

 

1: Murphy contributed $79,000 cash to the business, Terrence Murphy, Attorney. The business gave

 

capital to Murphy.

 

Date Account

 

s Post.

 

Ref. Debit Credit Jan. 1 0

 

0

 

0

 

0 0

 

0

 

0

 

0 Jan 3: Purchased office supplies, $400, and furniture, $1,300, on account.

 

Date

 

Jan. 3 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 4: Performed legal services for a client and received $1,500 cash.

 

Date

 

Jan. 4 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan. 7: Purchased a building with a market value of $140,000, and land with a market value of $25,000.

 

The business paid $70,000 cash and signed a note payable to the bank for the remaining amount.

 

Date

 

Jan. 7 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 11: Prepared legal documents for a client on account, $1,000.

 

Date

 

Jan. 11 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Jan 15: Paid assistant's semimonthly salary, $1,150. Debit Credit Date

 

Jan. 15 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 16: Paid for the office supplies purchased on January 3 on account.

 

Date

 

Jan. 16 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 18: Received $2,100 cash for helping a client sell real estate

 

Date

 

Jan. 18 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 19: Defended a client in court and billed the client for $600.

 

Date

 

Jan. 19 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 25: Received a bill for utilities, $250. The bill will be paid next month.

 

Date

 

Jan. 25 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan. 29: Received cash on account, $1,000.

 

Date

 

Jan. 29 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 30: Paid $1,200 cash for a 12-month insurance policy starting on February 1.

 

Date

 

Jan. 30 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Debit Credit Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Post.

 

Ref.

 

0

 

0

 

0

 

0 Debit Credit Jan 30: Paid assistant's semimonthly salary, $1,150

 

Date

 

Jan. 30 Account

 

s

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 Jan 30: Paid assistant's semimonthly salary, $1,150

 

Date

 

Jan. 30 Account

 

s

 

0

 

0

 

0

 

0 Jan 31: Murphy withdrew cash of $2,500.

 

Date

 

Jan. 31 Account

 

s

 

0

 

0

 

0

 

0 Requirement 2.

 

The following four column accounts have been opened for each of the accounts. Cash, 101; Accounts

 

Receivable, 111; Office Supplies, 121; Prepaid Insurance, 131; Furniture, 141; Building, 151; Land, 161;

 

Accounts Payable, 201; Utilities Payable, 211; Notes Payable, 221; Murphy, Capital, 301; Murphy,

 

Withdrawals, 311; Service Revenue, 411; Salaries Expense, 511; Rent Expense, 521; and Utilities

 

Expense, 531. Post the transactions to four-column accounts in the ledger, using dates, account numbers,

 

journal references, and posting references. Assume the journal entries were recorded on page 1 of the

 

journal. (Compute the new balance for each account after posting the transaction.)

 

CASH

 

Date Item Post.

 

Ref. 2017

 

Jan. 1

 

Jan. 4

 

Jan. 7

 

Jan. 15

 

Jan. 16

 

Jan. 18

 

Jan. 29

 

Jan. 30

 

Jan. 30

 

Jan. 31

 

Jan. 31 Debit Credit 0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0 ACCOUNTS RECEIVABLE

 

Date

 

2017

 

Jan. 11

 

Jan. 19

 

Jan. 29

 

OFFICE

 

SUPPLIE

 

S

 

Date

 

2017

 

Jan. 3 Account No. 101

 

Balance

 

Debit

 

Credit Item Post. Ref. Debit Credit Account No. 111

 

Balance

 

Debit

 

Credit 0

 

0

 

0

 

Account No. 121 Item Post. Ref. Debit

 

0 Credit Balance

 

Debit Credit PREPAID INSURANCE

 

Date

 

2017

 

Jan. 30 Item Post. Ref. Debit Credit Account No. 131

 

Balance

 

Debit

 

Credit Credit Account No. 141

 

Balance

 

Debit

 

Credit 0 FURNITURE

 

Date Item 2017

 

Jan. 3 Post.

 

Ref. Debit 0 BUILDIN

 

G Account No. 151 Date Item Post.

 

Ref. 2017

 

Jan. 7 Debit Credit Item Post.

 

Ref. 2017

 

Jan. 7 Debit Credit 2017

 

Jan. 3

 

Jan.

 

16 Ite

 

m Post. Ref. Debit Credit Account No. 201

 

Balance

 

Debit

 

Credit 0

 

0 UTILITIES PAYABLE

 

Date Account No. 161

 

Balance

 

Debit

 

Credit 0 ACCOUNTS PAYABLE

 

Date Credit 0 LAND

 

Date Balance

 

Debit Item Post.

 

Ref. Debit Credit Account No. 211

 

Balance

 

Debit

 

Credit 2017

 

Jan. 25 0 NOTES PAYABLE

 

Date Item Post.

 

Ref. 2017

 

Jan. 7 Debit Credit Account No. 221

 

Balance

 

Debit

 

Credit Credit Account No. 301

 

Balance

 

Debit

 

Credit Credit Account No. 311

 

Balance

 

Debit

 

Credit Credit Account No. 411

 

Balance

 

Debit

 

Credit Credit Account No. 511

 

Balance

 

Debit

 

Credit 0 MURPHY, CAPITAL

 

Date Item Post.

 

Ref. 2017

 

Jan. 1 Debit 0 MURPHY, WITHDRAWALS

 

Date

 

2017

 

Jan. 31 Item Post. Ref. Debit 0 SERVICE REVENUE

 

Date Item 2017

 

Jan. 4

 

Jan. 11

 

Jan. 18

 

Jan. 19 Post.

 

Ref. Debit 0

 

0

 

0

 

0 SALARIES EXPENSE

 

Date

 

2017

 

Jan. 15

 

Jan. 30 Item Post.

 

Ref.

 

0

 

0 Debit RENT EXPENSE

 

Date Item 2017

 

Jan. 31 Post.

 

Ref. Debit Credit 0 UTILITIES EXPENSE

 

Date

 

2017

 

Jan.

 

25 Account No. 521

 

Balance

 

Debit

 

Credit Ite

 

m Post. Ref. Debit Credit Account No. 531

 

Balance

 

Debit

 

Credit 0 Requirement 3. Prepare the trial balance of Terrence Murphy, Attorney, at January31, 2017.

 

Terrence Murphy, Attorney

 

Trial Balance

 

31-Jan17

 

Balanc

 

e

 

Account

 

Debit

 

Title

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

Total Credit The trial balance of Sheldon Mestler, CPA, is dated March31, 2017:

 

(Click the icon to view the March 3131 trial balance.)

 

Sheldon Mestler, CPA

 

Trial Balance

 

31-Mar-17

 

Account Title

 

Cash

 

Accounts

 

Receivable

 

Office Supplies

 

Furniture

 

Automobile

 

Land

 

Accounts Payable

 

Unearned Revenue

 

Mestler, Capital

 

Mestler,

 

Withdrawals

 

Service Revenue

 

Salaries Expense

 

Rent Expense

 

Total Balance

 

Debit

 

$10,000

 

13,500 Credit 1,300

 

0

 

0

 

20,000

 

$4,200

 

0

 

30,600

 

0

 

16,300

 

4,700

 

1,600

 

$51,100 $51,100 During April, the business completed the following transactions:

 

(Click the icon to view the transactions.)

 

4 Collected $4,000 cash from a client on account.

 

8 Performed tax services for a client on account, $6,300.

 

13 Paid $2,000 on account.

 

14 Purchased furniture on account, $4,400.

 

15 Mestler contributed his personal automobile to the business in exchange for capital. The automobile

 

had a market value of $7,000.

 

18 Purchased office supplies on account, $900.

 

19 Received $3,150 for tax services performed on lApril 8.

 

20 Mestler withdrew cash of $6,000.

 

21 Received $2,300 cash for consulting work completed. 24 Received $1,700 cash for accounting services to be completed next month.

 

27 Paid office rent, $1,500.

 

28 Paid employee salary, $1,900.

 

Read the requirements

 

1. Record the April transactions in the journal. Use the following accounts: Cash; Accounts Receivable;

 

Office Supplies; Furniture; Automobile; Land; Accounts Payable; Unearned Revenue; Mestler, Capital;

 

Mestler, Withdrawals; Service Revenue; Salaries Expense; and Rent Expense. Include an explanation for

 

each entry.

 

2. The four-column ledger accounts listed in the trial balance, together with their balances as of March

 

31, have been opened for you and utilize the following account numbers: Cash, 11; Accounts Receivable,

 

12; Office Supplies, 13; Furniture, 14; Automobile, 15; Land, 16; Accounts Payable, 21; Unearned

 

Revenue, 22; Mestler, Capital, 31; Mestler, Withdrawals, 33; Service Revenue, 41; Salaries Expense, 51;

 

and Rent Expense, 52. Post the journal entries to four-column accounts in the ledger, using dates,

 

account numbers, journal references, and posting references. Assume the journal entries were recorded

 

on page 5 of the journal.

 

3. Prepare the trial balance of Sheldon Mestler, CPA, at April 30, 2017.

 

Requirement 1.

 

Use the following accounts: Cash; Accounts Receivable; Office Supplies; Furniture; Automobile; Land;

 

Accounts Payable; Unearned Revenue; Mestler, Capital; Mestler, Withdrawals; Service Revenue; Salaries

 

Expense; and Rent Expense. Enter the appropriate posting references for each entry. (Record debits first,

 

then credits. Select the explanation on the last line of the journal entry table.)

 

April 4: Collected $4,000 cash from a client on account.

 

Date Accounts

 

Post.

 

Debit

 

and

 

Ref.

 

Explanatio

 

n

 

Apr. 4

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

0

 

April 8: Performed tax services for a client on account, $6,300 Credit Date Credit Apr. 8 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0 Debit 0

 

0 0 April 13: Paid $2,000 on account.

 

Date Apr. 13 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Post.

 

Ref. Debit Credit Debit Credit 0

 

0

 

0

 

0 April 14: Purchased furniture on account, $4,400.

 

Date Apr. 14 Accounts

 

and

 

Explanatio

 

n

 

0

 

0

 

0

 

0

 

0 Post.

 

Ref.

 

0

 

0

 

0

 

0 April 15: Mestler contributed his personal automobile to the business. The automobile had a market...

 


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