Question

Lynn Cantwell, an architect, organized Cantwell Architects on July 1, 2014. During the month, Cantwell Architects completed the following transactions:
a. Issued capital stock to Lynn Cantwell in exchange for $25,000.
b. Paid July rent for office and workroom, $2,750.
c. Purchased used automobile for $30,000, paying $4,000 cash and giving a note payable for the remainder.
d. Purchased office and computer equipment on account, $9,000.
e. Paid cash for supplies, $1,600.
f. Paid cash for annual insurance policies, $2,400.
g. Received cash from client for plans delivered, $11,150.
h. Paid cash for miscellaneous expenses, $300.
i. Paid cash to creditors on account, $3,500.
j. Paid installment due on note payable, $550.
k. Received invoice for blueprint service, due in August, $1,500.
l. Recorded fee earned on plans delivered, payment to be received in August, $17,300.
m. Paid salary of assistant, $2,200.
n. Paid gas, oil, and repairs on automobile for July, $815.

Instructions
1. Record the above transactions directly in the following T accounts, without journalizing: Cash, Accounts Receivable, Supplies, Prepaid Insurance, Automobiles, Equipment, Notes Payable, Accounts Payable, Capital Stock, Professional Fees, Rent Expense, Salary Expense, Blueprint Expense, Automobile Expense, Miscellaneous Expense. To the left of the amount entered in the accounts, place the appropriate letter to identify the transaction.
2. Determine account balances of the T accounts. Accounts containing a single entry only (such as Prepaid Insurance) do not need a balance.
3. Prepare an unadjusted trial balance for Cantwell Architects, as of July 31, 2014.
4. Determine the net income or net loss for July.



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  • CreatedFebruary 28, 2014
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