The chart of accounts of Annis’s Delivery Service is as follows: Cash, 111; Accounts Receivable, 112; Office Equipment, 121; Delivery Trucks, 122; Accounts Payable, 211; Avery Annis, Capital, 311; Avery Annis, Withdrawals, 312; Delivery Fees Earned, 411; Advertising Expense, 511; Gas Expense, 512; Salaries Expense, 513; and Telephone Expense, 514. Annis’s Delivery Service completed the following transactions during the month of August:
Transaction A: Avery invested $17,000 in the delivery service from her personal savings account.
Transaction B: Bought delivery trucks on account, $11,000.
Transaction C: Bought office equipment for cash, $600.
Transaction D: Paid advertising expense, $350.
Transaction E: Collected cash for delivery services rendered, $3,500.
Transaction F: Paid drivers’ salaries, $900.
Transaction G: Paid gas expense for trucks, $1,700.
Transaction H: Performed delivery services for a customer on account, $1,600.
Transaction I: Telephone expense due but unpaid, $600.
Transaction J: Received $400 as partial payment of transaction H.
Transaction K: Avery withdrew cash for personal use, $250.
As Avery’s newly hired accountant, you must perform the following:
1. The T accounts in the ledger have been set up for you. Record transactions in the T accounts. (Place the letter of the transaction next to the entry.)
2. Foot the T accounts where appropriate.
3. Prepare a trial balance at the end of August.
4. Prepare from the trial balance, in proper form,
(a) An income statement for the month of August,
(b) A statement of owner’s equity,
(c) A balance sheet as of August 31, 201X.