On July 31, 2022, the general ledger of Hills Legal Services Inc. showed the following balances: Cash $4,000, Accounts Receivable $1,500, Supplies $500, Equipment $5,000, Accounts Payable $4,100, Common Stock $3,500, and Retained Earnings $3,400. During August, the following transactions occurred. 

Instructions 

a. Using T-accounts, enter the beginning balances to the ledger. 

b. Journalize the August transactions.

c. Post the August journal entries to the ledger. 

d. Prepare a trial balance on August 31, 2022.

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Collected $1,200 of accounts receivable due from customers. Aug. 3 Received $1,300 cash for issuing common stock to new investors. Paid $2,700 cash on accounts payable. 7 Performed legal services of $6,500, of which $3,000 was collected in cash and the 6 remainder was due on account. Purchased additional equipment for $1,200, paying $400 in cash and the balance on 12 account. Paid salaries $3,500, rent $900, and advertising expenses $275 for the month of August. Collected the balance for the services performed on August 7. 14 18 Paid cash dividend of $500 to stockholders. 20 Billed a client $1,000 for legal services performed. Received $2,000 from Laurentian Bank; the money was borrowed on a bank note payable that is due in 6 months. Agreed to perform legal services for a client in September for $4,500. The client will pay the amount owing after the services have been performed. Received the utility bill for the month of August in the amount of $275; it is not due until September 15. 24 26 27 28 Paid income tax for the month $500. 31