Q 30PGA-2 - Horngren'S Financial And Managerial Accounting

Question

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

Ann Simpson started her practice as a design consultant on September 1, 2018. During the first month of operations, the business completed the following transactions: 

Sep. 1 Received \(48,000 cash and issued common stock to Simpson. 

4 Purchased office supplies, \)1,200, and furniture, \(1,300, on account. 

6 Performed services for a law firm and received \)1,900 cash. 

7 Paid \(18,000 cash to acquire land to be used in operations. 

10 Performed services for a hotel and received its promise to pay the \)1,200 within one week. 

14 Paid for the furniture purchased on September 4 on account. 

15 Paid assistant’s semimonthly salary, \(1,500. 

17 Received cash on account, \)1,000. 

20 Prepared a design for a school on account, \(650. 

25 Received \)2,100 cash for design services to be performed in October. 

28 Received \(2,900 cash for consulting with Plummer & Gordon. 

29 Paid \)600 cash for a 12-month insurance policy starting on October 1. 

30 Paid assistant’s semimonthly salary, \(1,500. 

30 Paid monthly rent expense, \)600. 

30 Received a bill for utilities, \(350. The bill will be paid next month. 

30 Paid cash dividends of \)3,700.

Requirements 2. Open a T-account for each of the accounts.

Step-by-Step Solution

Answer

The t-accounts are shorter form ledger accounts and required t-accounts are opened.

Step-by-Step Solution Step 1 Definition of T-Accounts

The T-accounts are defined as the shortened form of the ledger accounts which are prepared to transfer transactions from the journal.

Step 2 Opening T-Accounts

 

Cash

 

Accounts Receivables

 

Office Supplies

 

Prepaid Insurance

 

Land

 

 

Furniture

 

 

Accounts Payable

 

Utilities Payable

 

Unearned Revenue

 

Common Stock

 

Dividends

 

Service Revenue

 

Salaries Expense

 

Rent Expense

 

Utilities Expense