Question

Transaction Analysis and Trial Balance Make T-accounts for the following accounts that appear in the general ledger of Dave Jennings, an attorney: Cash; Accounts Receivable: Office Equipment: Legal Database Subscription: Accounts Payable; Common Stock Dividends: Legal Fees Earned; Salaries Expense; Rent Expense; and Utilities Expense. Using the accounting equation, record each of the transactions in a columnar format. Prepare journal entries and record the following October transactions in the T- accounts and key all entries with the number identifying the transaction. Determine the balance in each account and prepare a trial balance sheet as of October 31. 1 Jennings started his law practice by contributing $21.500 cash to the business on October 1, receiving shares of common stock in the company 2 Purchased office equipment on count, 511,400. 3 Paid office rent for October 31,100. 4 Paid 59,750 to access online legal database for two years 5 Billed clients for services rendered, $14,000 6 Made 16.000 payment on account for the equipment purchased on October 2. 7 Paid legal assistant's salary: $2800. 8 Collected $7.500 from clients previously billed for services 9 Received invoice for October utilities, 5190; will be paid in November 10 Paid stockholders $1,500 as a cash dividend. years Support 7:19 PM S 0 520

Answer 1

Solution:

	Journal Entries
S.No	Particulars	Debit	Credit
1	Cash	21500
	Common Stock		21500
2	Office Equipments	11400
	Accounts payable		11400
3	Rent Expense	1100
	Cash		1100
4	Legal Database Subscription	9750
	Cash		9750
5	Accounts Receivable	14000
	Legal Fees Earned		14000
6	Accounts payable	6000
	Cash		6000
7	Salaries Expense	2800
	Cash		2800
8	Cash	7500
	Accounts Receivable		7500
9	Utilities Expense	190
	Accounts payable		190
10	Dividends	1500
	Cash		1500

Ledger Accounts
Cash
Particulars	Ref	Debit	Credit
Common Stock	1	21500
Rent Expense	3		1100
Legal Database Subscription	4		9750
Accounts payable	6		6000
Salaries Expense	7		2800
Accounts Receivable	8	7500
Dividends	10		1500
		29000	21150
Debit balance		7850
Accounts Receivable
Particulars	Ref	Debit	Credit
Legal Fees Earned	5	14000
Cash	8		7500
		14000	7500
Debit balance		6500
Office Equipment
Particulars	Ref	Debit	Credit
Accounts payable	2	11400
Debit balance		11400
Legal Database Subscription
Particulars	Ref	Debit	Credit
Cash	4	9750
Debit balance		9750

Accounts payable
Particulars	Ref	Debit	Credit
Office Equipments	2		11400
Cash	6	6000
Utilities Expense	9		190
		6000	11590
Credit balance			5590
Common Stock
Particulars	Ref	Debit	Credit
Cash	1		21500
Credit balance			21500
Dividends
Particulars	Ref	Debit	Credit
Cash	10	1500
Debit balance		1500
Legal Fees Earned
Particulars	Ref	Debit	Credit
Accounts Receivable	5		14000
Credit balance			14000
Salaries Expense
Particulars	Ref	Debit	Credit
Cash	7	2800
Debit balance		2800
Rent Expense
Particulars	Ref	Debit	Credit
Cash	3	1100
Debit balance		1100
Utilities Expense
Particulars	Ref	Debit	Credit
Accounts payable	9	190
Debit balance		190

Trial Balance
Accounts	Debit	Credit
Cash	7850
Accounts Receivable	6500
Office Equipment	11400
Legal Database Subscription	9750
Accounts payable		5590
Common Stock		21500
Dividends	1500
Legal Fees Earned		14000
Salaries Expense	2800
Rent Expense	1100
Utilities Expense	190
	41090	41090

Accounting Equation:

	Cash +         Accounts Receivable + Database Subscription +   Office Equipments     =   Accounts payable + Common Stock   +   Retained Earnings
1	21500					21500
2				11400	11400
3	-1100						-1100
4	-9750		9750
5		14000					14000
6	-6000				-6000
7	-2800						-2800
8	7500	-7500
9					190		-190
10	-1500						-1500
Total	7850	6500	9750	11400	5590	21500	8410
LHS	35500				RHS	35500