Question

Entries into T Accounts and Trial Balance Connie Young, an architect, opened an office on October 1, 2019. During the month, she completed the following transactions connected with her professional practice: Transferred cash from a personal bank account to an account to be used for the business, $28,600. Paid October rent for office and workroom, $2,900. Purchased used automobile for $19,000, paying $4,300 cash and giving a note payable for the remainder. Purchased office and computer equipment on account, $5,700. Paid cash for supplies, $1,370. Paid cash for annual insurance policies, $1,900. Received cash from client for plans delivered, $7,200. Paid cash for miscellaneous expenses, $770. Paid cash to creditors on account, $1,660. Paid $230 on note payable. Received invoice for blueprint service, due in November, $900. Recorded fees earned on plans delivered, payment to be received in November, $4,900. Paid salary of assistants, $1,500. Paid gas, oil, and repairs on automobile for October, $370. Required: 1. Record the above transactions (in chronological order) directly into the T accounts. To the left of the amount entered in the accounts, select 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.

Answer 1

Record and balance the transactions in T accounts for various business operations.

Step-by-step explanation:

Record the transactions in T accounts:

1. Transfer cash from personal bank account to business account: Debit: Cash $28,600, Credit: Capital $28,600
2. Pay October rent for office and workroom: Debit: Rent Expense $2,900, Credit: Cash $2,900
3. Purchase used automobile: Debit: Automobile $19,000, Debit: Note Payable $14,700 (19,000 - 4,300), Credit: Cash $4,300, Credit: Note Payable $14,700
4. Purchase office and computer equipment on account: Debit: Office Equipment $5,700, Debit: Computer Equipment $5,700, Credit: Accounts Payable $5,700
5. Pay cash for supplies: Debit: Supplies $1,370, Credit: Cash $1,370
6. Pay cash for annual insurance policies: Debit: Prepaid Insurance $1,900, Credit: Cash $1,900
7. Receive cash from client for plans delivered: Debit: Cash $7,200, Credit: Fees Earned $7,200
8. Pay cash for miscellaneous expenses: Debit: Miscellaneous Expenses $770, Credit: Cash $770
9. Pay cash to creditors on account: Debit: Accounts Payable $1,660, Credit: Cash $1,660
10. Pay $230 on note payable: Debit: Note Payable $230, Credit: Cash $230
11. Receive invoice for blueprint service: Debit: Accounts Payable $900, Credit: Blueprint Service Expense $900
12. Record fees earned on plans delivered: Debit: Accounts Receivable $4,900, Credit: Fees Earned $4,900
13. Pay salary of assistants: Debit: Salary Expense $1,500, Credit: Cash $1,500
14. Pay gas, oil, and repairs on automobile for October: Debit: Automobile Expense $370, Credit: Cash $370

Determine account balances:

Answer 2

Cash Capital

debit credit debit credit

1. 28,600 1. 28,600

2. 2,900

3. 4,300

4. 1,370

5. 1,900

6. 7,200

7. 770

8. 1,660

9. 230

12. 1,500

13. 370

20,800

Rent expense Vehicles

debit credit debit credit

2. 2,900 3. 19,000

Notes payable Service revenue

debit credit debit credit

3. 14,700 6. 7,200

9. 230 11. 4,900

14,470 12,100

Accounts payable Equipment

debit credit debit credit

4. 5,700 4. 5,700

8. 1,660

10. 900

4,940

Supplies Prepaid insurance

debit credit debit credit

4. 1,370 5. 1,900

Misc. expenses Blueprint services expense

debit credit debit credit

7. 770 10. 900

Accounts receivable Wages and salaries expense

debit credit debit credit

11. 4,900 12. 1,500

Vehicle maintenance expenses

debit credit

13. 370