Chapter 2 Checkpoint Problem #1

Following are the June transactons for Love Corporations: 1. Shareholders invested $45,000 cash in exchange for shares of stock. 2. Purchased tennis supplies for $1,800 on account from Sportstore, Inc. 3. Paid rent for the month of June $2,400. 4. Purchased tennis equipment for $12,000; paid $2,000 cash and signed a promissory note for the balance due. 5. Billed a local tennis club for tennis lessons given, $2,600. 6. Purchased a one-year property insurance policy for $600 cash. 7. Received $1,500 cash in advance from a senior citizen's group for three months of tennis lessons to be given to the group beginning in July. 8. Made a payment on account to Sportstore, Inc. for $1,800. 9. Received $3,600 cash from a large tennis organization for tennis lessons given. 10. Received a bill for equipment repairs, $180--the bill will be paid in July. 11. Received $1,400 cash on account from the previously billed tennis club. 12. $1,500 of cash dividends were declared and paid to shareholders. 13. Paid the salary to the office assistant, $800. Instructions: A. Post the effect of the transactions to the appropriate T-accounts. B. Balance the accounts and prepare a trial balance below. DR CR Cash Accounts Receivable Tennis Supplies Prepaid Insurance Tennis Equipment Accounts Payable Notes Payable Unearned Service Revenue Common Stock Retained Earnings Dividends Declared Service Revenue Salaries Expense Rent Expense Repairs Expense Totals