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Accounts Payable
Account No. 212
Date
Item
Post.
Ref.
Debit
Credit
Balance
Debit
Credit
2010
Dec.
1
J1
8,200
7
J1
2,800
8
J2
600
12
J2
800
19. Given the following ledger account and postings, complete the Balance column. Assume no previous
postings in the account.
Accounts Receivable
Account No. 113
Date
Item
Post.
Ref.
Debit
Credit
Balance
Debit
Credit
2010
Feb.
1
J2
1,820
3
J3
320
9
J3
700
14
J3
410
20. What two purposes are served by using the Post. Ref. columns of a journal and ledger?
21. Briefly explain the difference between Unearned Art Fees and Art Fees Earned.
22. Use the following descriptive phrases to determine the account name that would be used for each. In
addition, classify the account as an asset (A), liability (L), stockholders' equity (SE), revenue (R), or
expense (E).
a. Amount due to creditor for merchandise purchased
b. Coins and currency
c. Property to be used in the business
d. An amount paid to stockholders resulting from profits
e. Income recorded for performance of legal services
f. Amount due to bank for loan to purchase building
g. Stationery, pencils, etc., purchased but not yet used
h. Stationery, pencils, etc., that have been consumed (used)
i. An insurance premium paid covering the next two years
j. Representation of stockholders' investments in a business
23. Briefly discuss the differences between Prepaid Insurance and Insurance Expense.
24. Using the following transactions, calculate (a) the ending balance of Cash, (b) the ending balance of
Accounts Receivable, (c) total liabilities, and (d) net income for the period.
a. Opened business by issuing common stock for $20,000.
b. Billed customers for services rendered, $4,000.
c. Paid for six months' subscription in advance, $1,000.
d. Received advertising bill, to be paid next week, $200.
e. Dividends of $1,600 were declared and paid.
f. Received $3,000 from customers billed in b.
g. Paid half of advertising bill.
h. Received $400 in advance of performing a service.
25. Using the following transactions, calculate (a) net income for the period, as well as the ending
balances of (b) total assets, (c) total liabilities, and (d) Cash.
a. Opened business by issuing common stock for $36,000.
b. Paid one year's insurance in advance, $2,400.
c. Billed customers for services rendered, $6,000.
d. Received utility bill, to be paid next month, $400.
e. Received $800 in advance of performing a service.
f. Received $4,400 from customers billed in c.
g. Paid $300 on the utility bill of d.
h. Dividends of $2,000 were declared and paid.
26. Using the T accounts below, record the following transactions. Label each entry with the appropriate
letter.
a. The stockholders contributed cash of $40,000 and a truck worth $48,000 into the business in
exchange for 8,800 shares of $10 par value stock.
b. Paid two months' rent in advance, $2,400.
c. Agreed to do a hauling job for a price of $6,400.
d. Performed the hauling job. Will get paid later.
e. Received payment of $2,000 on the hauling job.
f. Purchased gasoline on credit, $40.
27. From the following alphabetical list of account balances, all of which are normal, for Kasper
Corporation on July 31, 2010, prepare a trial balance in proper form (the amount of Dividends must be
computed).
Accounts Payable
$500
Accounts Receivable
200
Cash
80
Common Stock
90
Dividends
?
Equipment
700
Prepaid Advertising
20
Retained Earnings
60
Revenue Earned
400
Wages Expense
70
Wages Payable
50
28. From the following alphabetical list of account balances, all of which are normal, for Aloha
Corporation on September 30, 2010, prepare a trial balance in proper form (the amount of Dividends
must be computed).
Accounts Payable
$ 780
Accounts Receivable
460
Cash
400
Common Stock
800
Dividends
?
Equipment
1,380
Prepaid Advertising
20
Retained Earnings
400
Revenue Earned
1,000
Wages Expense
60
Wages Payable
20
29. Using the alphabetical list of account balances presented below, all of which are normal, prepare a trial
balance for T. and C. Corporation at June 30, 2010, in proper order. Compute the balance of the Cash
account.
Accounts Payable
$140
Accounts Receivable
280
Cash
?
Common Stock
200
Equipment
400
Office Expense
180
Retained Earnings
240
Service Revenue
300
30. In the journal provided, prepare journal entries (in good form) for the following transactions. If no
entry is required, write “no entry.” Omit explanations.
Apr.
1
Investors opened a dry cleaning service, called Same Day Cleaners, by depositing
$60,000 into a business bank account and receiving 60,000 shares of $1 par value
stock in exchange.
3
Paid two years' rent in advance, $14,400.
6
Purchased dry cleaning equipment for $40,000. Paid $8,000 in cash, the remainder
to be paid in two weeks.
9
Hired a part-time worker, to be paid $300 per week, starting tomorrow.
17
Paid the worker's weekly wage.
17
Recorded cash received for services performed during the week, $3,000.
20
Paid for the remainder of the equipment purchased on April 6.
21
Received $200 in advance of cleaning and boxing a wedding gown.
23
Performed $500 of dry cleaning services for Asa's Tuxedo Shop. It will remit
payment in three days.
24
Paid the weekly wages.
26
Received payment from Asa's Tuxedo Shop.
30
Received a telephone bill for $100, which will be paid in two weeks.
General Journal
Page 1
Date
Description
Post.
Ref.
Debit
Credit
31. In the journal provided, prepare journal entries (in good form) for the following transactions. If no
entry is required, write “no entry.” Omit explanations.
May
1
Investors opened a dry cleaning service, called Junction Cleaners, by depositing
$100,000 into a business bank account and receiving 50,000 shares of $2 par value
stock in exchange.
3
Paid two years' rent in advance, $11,200.
6
Purchased dry cleaning equipment for $36,000. Paid $14,000 in cash, the
remainder to be paid in two weeks.
10
Hired a worker, to be paid $550 per week.
17
Paid the worker's weekly wage.
17
Recorded cash received for services rendered during the week, $5,000.
20
Paid for the remainder of the equipment purchased on May 6.
21
Received $240 in advance of cleaning and boxing a wedding gown.
23
Performed $390 of dry cleaning services for Tuxedos Unlimited. It will remit
payment in three days.
24
Paid the weekly wages.
26
Received payment from Tuxedos Unlimited.
30
Received a telephone bill for $114, which will be paid in two weeks.
General Journal
Page 1
Date
Description
Post.
Ref.
Debit
Credit
32. In the journal provided, prepare journal entries (in good form) for the following transactions. If no
entry is required, write “no entry.” Omit explanations.
Mar.
1
Investors opened a dance school, called Yolonda's Dance Studio, by depositing
$15,000 into a business bank account in exchange for 15,000 shares of $1 par
value stock.
2
Paid three months' rent in advance, $1,800.
4
Hired a part-time assistant, to be paid $250 per week, starting next week.
6
Purchased sound equipment for $2,000. Paid $400 in cash, the remainder to be
paid in installments of $800 every two weeks.
8
Signed up five students, who will begin lessons on March 10, at $80 per week
per student.
17
Received the first week's tuition from four students; the fifth student will remit
payment in three days.
17
Paid the assistant his first week's wages.
20
Received payment from the fifth student.
21
Paid the first installment on the sound equipment purchased on March 6.
23
Received an electric bill of $100, to be paid April 1.
General Journal
Page 1
Date
Description
Post.
Ref.
Debit
Credit
33. In the journal provided, prepare journal entries (in good form) for the following transactions. If no
entry is required, write “no entry.” Omit explanations.
Nov.
1
Investors opened a dance school called Olga's Dance Studio by depositing
$24,000 into a business bank account in exchange for 24,000 shares of $1 par
value stock.
2
Paid three months' rent in advance, $2,400.
4
Hired a part-time assistant, to be paid $275 per week.
6
Purchased sound equipment for $4,200. Paid $600 in cash, the remainder to be
paid in installments of $1,200 every two weeks.
8
Signed up ten students, who will begin lessons on November 10, at $100 per
week per student.
17
Received the first week's tuition from nine students; the tenth student will remit
payment in three days.
17
Paid the assistant his first week's wages.
20
Received payment from the tenth student.
20
Paid the next installment on the sound equipment purchased on November 6.
23
Received an electric bill of $150, to be paid on December 1.
General Journal
Page 1
Date
Description
Post.
Ref.
Debit
Credit
34. Post the following transaction.
General Journal
Page 14
Date
Description
Post.
Ref.
Debit
Credit
2010
July
20
Accounts Receivable
415
Commissions Earned
415
Commission earned on sale of painting
Accounts Receivable
Account No. 112
Date
Item
Post.
Ref.
Debit
Credit
Balance
Debit
Credit
2010
Commissions Earned
Account No. 411
Date
Item
Post.
Ref.
Debit
Credit
Balance
Debit
Credit
2010
ANS:
35. Post the following transaction.
General Journal
Page 8
Date
Description
Post.
Ref.
Debit
Credit
2010
May
12
Land
5,000
Notes Payable
5,000
Issued note for purchase of land
Land
Account No. 141
Date
Item
Post.
Ref.
Debit
Credit
Balance
Debit
Credit
2010
Notes Payable
Account No. 211
Date
Item
Post.
Ref.
Debit
Credit
Balance
Debit
Credit
2010
