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Chapter 2: 4SE (page 91)
Calculating the balance of a T-account
Accounts Payable
May 2 6,000 21,000 May 1
May 22 11,500 500 May 5
8,500 May 15
500 May 23
Calculate the Accounts Payable balance.
Accounts payable is money owed to the supplier and the balance of accounts payable is $13,000
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Journalizing transactions, posting to T-accounts, and preparing a trial balance
Consider the following transactional data for the first month of operations for Crystal Clear Cleaning.
Nov. 1 Stockholders contributed \(15,000 and a truck, with a market value of \)3,000, to the business in exchange for common stock.
2 The business paid \(4,000 to Pleasant Properties for November through February rent. (Debit Prepaid Rent)
3 Paid \)4,800 for a business insurance policy for the term November 1, 2018 through October 31, 2019. (Debit Prepaid Insurance)
4 Purchased cleaning supplies on account, \(320.
5 Purchased on account an industrial vacuum cleaner costing \)1,500. The invoice is payable November 25.
7 Paid \(3,900 for a computer and printer.
9 Performed cleaning services on account in the amount of \)4,700.
10 Received \(200 for services rendered on November 9. 15 Paid employees, \)400.
16 Received \(15,000 for a 1-year contract beginning November
16 for cleaning services to be provided. Contract begins November 16, 2018, and ends November 15, 2019. (Credit Unearned Revenue)
17 Provided cleaning services and received \)400 cash.
18 Received a utility bill for \(175 with a due date of December 4, 2018. (Use Accounts Payable)
20 Borrowed \)36,000 from bank with interest rate of 6% per year.
21 Received \(500 on account for services performed on November 9.
25 Paid \)750 on account for vacuum cleaner purchased on November 5.
29 Paid \(200 for advertising.
30 Cash dividends of \)1,400 were paid to stockholders
3. Post the journal entries to the T-accounts, and calculate account balances
Journalizing transactions
Harper Sales Consultants completed the following transactions during the latter part of January:
Jan. 22 Performed services for customers on account, \(7,500.
30 Received cash on account from customers, \)8,000.
31 Received a utility bill, \(220, which will be paid during February.
31 Paid monthly salary to salesman, \)2,500.
31 Received \(2,310 for three months of consulting service to be performed starting in February.
31 Cash dividends of \)950 were paid to stockholders.
Journalize the transactions of Harper Sales Consultants. Include an explanation with each journal entry.
Journalizing transactions and posting to T-accounts
Roland Foster Optical Dispensary completed the following transactions during the latter part of March:
Mar. 15 Purchased office supplies on account, \(3,400.
28 Paid \)1,800 on account.
Requirements ,
2. Open the following accounts (use T-account format): Cash (Beginning Balance of $21,000), Office Supplies, and Accounts Payable. Post the journal entries from Requirement 1 to the accounts, and compute the balance in each account.
Explain the five steps in journalizing and posting transactions.
Journalizing transactions, posting journal entries to T-accounts, and preparing a trial balance
Beth Stewart started her practice as a design consultant on November 1, 2018. During the first month of operations, the business completed the following transactions:
Nov. 1 Received \(41,000 cash and issued common stock to Stewart.
4 Purchased office supplies, \)1,200, and furniture, \(2,300, on account.
6 Performed services for a law firm and received \)2,100 cash.
7 Paid \(27,000 cash to acquire land to be used in operations.
10 Performed services for a hotel and received its promise to pay the \)800 within one week.
14 Paid for the furniture purchased on November 4 on account.
15 Paid assistant鈥檚 semimonthly salary, \(1,470.
17 Received cash on account, \)500.
20 Prepared a design for a school on account, \(680.
25 Received \)1,900 cash for design services to be performed in December.
28 Received \(3,100 cash for consulting with Plummer & Gordon.
29 Paid \)840 cash for a 12-month insurance policy starting on December 1.
30 Paid assistant鈥檚 semimonthly salary, \(1,470. 30 Paid monthly rent expense, \)650.
30 Received a bill for utilities, \(650. The bill will be paid next month.
30 Paid cash dividends of \)2,800.b
Requirements 4. Prepare the trial balance of Beth Stewart, Designer, as of November 30, 2018.
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