29PGA_2 - Horngren'S Financial And Managerial Accounting

Question

Question: Journalizing transactions, posting journal entries to T-accounts, and preparing a trial balance 

Vince York practices medicine under the business title Vince York, M.D. During July, the medical practice completed the following transactions: 

Jul. 1 York contributed \(63,000 cash to the business in exchange for common stock. 

5 Paid monthly rent on medical equipment, \)510. 

9 Paid \(23,000 cash to purchase land to be used in operations. 

10 Purchased office supplies on account, \)1,600. 

19 Borrowed \(22,000 from the bank for business use. 

22 Paid \)1,100 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 \)6,400 cash and \(6,000 on account. 

31 Paid employees’ salaries \)2,200, office rent \(1,900, and utilities \)560. Record as a compound entry. 

31 The business received \(1,120 for medical screening services to be performed next month. 

31 Paid cash dividends of \)7,200.

The business uses the following accounts: Cash; Accounts Receivable; Office Supplies; Land; Accounts Payable; Advertising Payable; Unearned Revenue; Notes Payable; Common Stock; Dividends; Service Revenue; Salaries Expense; Rent Expense; Utilities Expense; and Advertising Expense. 

Requirements 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.

Step-by-Step Solution

Answer

The T-accounts are shortened forms of ledgeraccounts and all the required t-Accounts are prepared in step 2.

Step-by-Step Solution Step 1: Definition of T-Account

The t-accounts are defined as the shortened form of the ledger account which is prepared to post the journal entries

Step 2:Preparing T-Accounts

 

Cash
Jul 1     $63,000	$510        Jul 5
Jul 18    $22,000	$23,000    Jul 9
Jul 31   $1,120	$1,100     Jul 22
Jul 31   $6,400	$7,200   Jul 31
	$2,200    July 31
	$1,900    Jul 31
	$560       Jul 31
Bal.     $56,050

 

Accounts Receivables
Jul 31    $6,000
Bal        $6,000
Office Supplies
Jul 10     $1,600
Bal        $1,600

 

Land
Jul 9      $23,000
Bal.       $23,000

 

Accounts Payable
Jul 22     $1,100	$1,600         Jul 10
	$500      Bal.

 

Advertising Payable
	$240      Jul 28
	$240        Bal.

 

Unearned Revenue
	$1,120   Jul 31
	$1,120     Bal.

 

Notes Payable
	$22,000         Jul     19
	$22,000      Bal.

 

Common Stock
	$63,000    Jul 1
	$63,000      Bal.

 

Dividends
Jul 31  $7,200``
Bal.   $7,200

 

Service Revenue
	$6,400    Jul 31
	$6,000    July 31
	12,400     Bal.

 

Salaries Expense
Jul 31   $2,200
Bal.     $2,200

 

Rent Expense
Jul 5   $510
Jul 31  $1,900
Bal.   2,410

 

Utilities Expense
Jul 31         $560
Bal.     $560

 

Advertising Expense
Jul 28    $240
Bal.       $240