Journalizing transactions, posting journal entries to T-accounts, and preparing a trial balance
Vincent Yarwood practices medicine under the business title Vincent Yarwood, M.D. During July, the medical practice completed the following transactions:
Jul. 1 Yarwood contributed $68,000 cash to the business in exchange for capital.
5 Paid monthly rent on medical equipment, $550.
9 Paid $17,000 cash to purchase land to be used in operations.
10 Purchased office supplies on account, $1,800.
19 Borrowed $24,000 from the bank for business use.
22 Paid $1,700 on account.
28 The business received a bill for advertising in the daily newspaper to be paid in August, $290.
31 Revenues earned during the month included $6,000 cash and $5,500 on account.
31 Paid employees’ salaries $2,000, office rent $1,000, and utilities $550. Record as a compound entry.
31 The business received $1,260 for medical screening services to be performed next month.
31 Yarwood withdrew cash of $7,400.
The business uses the following accounts: Cash; Accounts Receivable; Office Supplies; Land; Accounts Payable; Advertising Payable; Unearned Revenue; Notes Payable; Yarwood, Capital; Yarwood, Withdrawals; Service Revenue; Salaries Expense; Rent Expense; Utilities Expense; and Advertising Expense.
1. Journalize each transaction. Explanations are not required.
2. Post the journal entries to the T-accounts, using transaction dates as posting references in the ledger accounts. Label the balance of each account Bal.
3. Prepare the trial balance of Vincent Yarwood, M.D., as of July 31, 2017.
Journalizing transactions, posting to T-accounts, and preparing a trial balance
Problem P2-41 continues with the consulting business begun in Problem P1-54 in Chapter 1. Here you will account for Daniels Consulting’s transactions as it is actually done in practice.
Daniels Consulting completed the following transactions during December 2016:
Dec. 2 Daniels contributed $20,000 cash in exchange for capital.
2 Paid monthly office rent, $2,000.
3 Paid cash for a computer, $3,600. This equipment is expected to remain in service for five years.
4 Purchased office furniture on account, $3,000. The furniture should last for five years.5Purchased office supplies on account, $800.
9 Performed consulting service for a client on account, $2,500.
12 Paid utilities expenses, $150.
18 Performed service for a client and received cash of $2,100.
21 Received $2,400 in advance for client service to be performed in the future.
21 Hired an administrative assistant to be paid $2,055 on the 20th day of each month. The secretary begins work immediately.
26 Paid $200 on account.
28 Collected $400 on account.
30 Daniels withdrew $1,000.
1. Journalize the transactions, using the following accounts: Cash; Accounts Receivable; Office Supplies; Equipment; Furniture; Accounts Payable; Unearned Revenue; Daniels, Capital; Daniels, Withdrawals; Service Revenue; Rent Expense; and Utilities Expense. Explanations are not required.
2. Open a T-account for each of the accounts.
3. Post the journal entries to the T-accounts, and calculate account balances. Formal posting references are not required.
4. Prepare a trial balance as of December 31, 2016.
5. Prepare the income statement of Daniels Consulting for the month ended December 31, 2016.
6. Prepare the statement of owner’s equity for the month ended December 31, 2016.
7. Prepare the balance sheet as of December 31, 2016.
8. Calculate the debt ratio for Daniels Consulting at December 31, 2016.
This question was asked on Jul 20, 2016 and answered on Jul 22, 2016 for the course ACCOUNTING ACC-250 at Grand Canyon.
Recently Asked Questions
- Hi! Kindly help me with my Strategic Management Case Study. The title of the case is " Citibank in Zaire". You can read the case here at page 483
- Your company has spent $270,000 on research to develop a new computer game. The firm is planning to spend $47,000 on a machine to produce the new game.
- Please refer to the attachment to answer this question. This question was created from Balance Sheet. Additional comments: "Can you explain how the company