Question

Aracel Engineering completed the following transactions in the month of June. a. Jenna Aracel, the owner, invested $155,000 cash, office equipment with a value of $5,700, and $74,000 of drafting equipment to launch the company. b. The company purchased land worth $58,000 for an office by paying $7,900 cash and signing a long-term note payable for $50,100. c. The company purchased a portable building with $52,000 cash and moved it onto the land acquired in b. d. The company paid $4,000 cash for the premium on an 18- month Insurance policy. e. The company completed and delivered a set of plans for a client and collected $8,500 cash. 1. The company purchased $20,000 of additional drafting equipment by paying $9,600 cash and signing a long-term note payable for $10,400 9. The company completed $14,000 of engineering services for a client. This amount is to be received in 30 days. n. The company purchased $1,750 of additional office equipment on credit. I. The company completed engineering services for $22.000 on credit. J. The company received a bill for rent of equipment that was used on a recently completed job. The $1,413 rent cost must be paid within 30 days. k. The company collected $7.000 cash in partial payment from the client described in transaction g. 1. The company paid $1,400 cash for wages to a drafting assistant. n. The company paid $1,750 cash to settle the account payable created in transaction n. n. The company paid $1,070 cash for minor maintenance of its drafting equipment. o. Jenna Aracel withdrew $9,150 cash from the company for personal use. p. The company paid $2,200 cash for wages to a drafting assistant 9. The company paid $3,800 cash for advertisements on the Web during June. Required: 1. Prepare general Journal entries to record these transactions using the following titles: Cash (101): Accounts Receivable (106); Prepaid Insurance (108): Office Equipment (163); Drafting Equipment (164) Building (1701: Land (172); Accounts Payable (201) Notes Payable (250); J. Aracel, Capital (301): J. Aracel, Withdrawals (302); Engineering Fees Eamed (402): Wages Expense (601); Equipment Rental Expense (602); Advertising Expense (603); and Repairs Expense (604). 2. Post the journal entries from part 1 to the ledger accounts. 3. Prepare a trial balance as of the end of June.

Answer 1

Trial Balance
Account Titles	Debit	Credit
Cash	$          77,630
Accounts Receivable	$          29,000
Prepaid Insurance	$            4,000
Office Equipment	$            7,450
Drafting Equipment	$          94,000
Building	$          52,000
Land	$          58,000
Accounts Payable		$         1,413
Notes Payable		$       60,500
J. Aracel, Capital		$     234,700
J. Aracel, Withdrawls	$            9,150
Engineering Fees Earned		$       44,500
Wages Expense	$            3,600
Equipment Rental Expense	$            1,413
Advertising Expense	$            3,800
Repairs Expense	$            1,070
Totals	$        341,113	$     341,113

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