Assignment-4 and 8

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The key takeaways are the basic accounting equation and how to record transactions that affect assets, liabilities, and owner's equity.

To record transactions in the basic accounting equation, debit assets for increases and credit assets for decreases. Debit owner's equity for contributions and credit owner's equity for withdrawals.

To prepare a trial balance, list all accounts and their balances and ensure total debits equal total credits.

Part A (30 points)

Record the following transactions in the basic accounting equation:


a.Brian invests $10,000 cash to begin an accounting service.
b.The company buys office furniture for cash, $600.
c.The company buys additional office furniture on account, $300.
d.The company makes a payment on the office furniture, $200.

Brian's Accounting Service

ASSETS = LIABILITIES + OWNER'S EQUITY


Cash + Office Furniture = Accounts Payable + Brian's Capital

SOLUTION
Assets = Liabilities +
Cash + Office Furniture Accounts payable

a. $ 10,000 =

b. $ (600) $ 600 =

c. $ 300 = $ 300

d. $ (200) = $ (200)
Owner's Equity
Brian's Capital

$ 10,000
Part B (40 points)

The following is a list of accounts and their balances for Benson Company for the month ended June 30, 20xx. Prepare a trial b

Cash $1,370
Accounts Payable 770
Office Equipment 900
Benson, Capital 1,500
Benson, Withdrawals 500
Accounts Receivable 1,600
Service Fees 2,730
Salaries Expense 630

Benson Company
Trial Balance
June 30, 20xx

Particulars Debit Credit

Cash $ 1,370
Accounts Payable $ 770
Office equipment $ 900
Benson, Capital $ 1,500
Benson, Withdrawals 500
Accounts receivable 1600
Service Fees $ 2,730
Salaries expense $ 630

$ 5,000 $ 5,000
une 30, 20xx. Prepare a trial balance in good form.
Part C (30 points)

The following transactions occurred during June for Campus Cycle Shop. Record the transactions below in the T accounts. Place
transaction next to the entry. Foot and calculate the ending balances of the T accounts where appropriate.
a.Tyler invested $6,500 in the bike service from his personal savings account.
b.Bought office equipment for cash, $900.
c.Performed bike service for a customer on account, $1,000.
d.Company cell phone bill received, but not paid, $80.
e.Collected $500 from customer in transaction c.
f.Tyler withdrew $300 for personal use.

CASH 111
a capital $ 6,500 b office equipment $ 900
e Accounts receivabl $ 500 f Tyler's withdrawal $ 300

c/d $ 5,800
$ 7,000 $ 7,000

TYLER'S CAPITAL 311


a cash $ 6,500

OFFICE EQUIPMENT 112


b cash $ 900

BIKE FEES 411


c Accounts Receivabl $ 1,000
ACCOUNTS RECEIVABLE 112
c service revenue $ 1,000 e cash $ 500

c/d $ 500
$ 1,000 $ 1,000

TELEPHONE EXPENSE 512


d Phone Payable $ 80

ACCOUNTS PAYABLE 211


d Phone Expense $ 80

TYLER'S WITHDRAWALS 312


f cash $ 300
ns below in the T accounts. Place the letter of the
appropriate.
Part D (20 points)

Prepare in proper form journal entries for the following transactions. Omit explanations.

October
2 Owner made a cash investment into the company $5,000
8 Bought supplies on account $100.
10 Paid salaries, $700
15 Paid for supplies purchased on October 8
21 Received company telephone bill, to be paid later, $30

Date Particulars Debit Credit

2-Oct Cash $ 5,000


Capital $ 5,000

8-Oct Supplies $ 100


Accounts Payable $ 100

10-Oct Salaries Expense $ 700


Cash $ 700

15-Oct Accounts Payable $ 100


Cash $ 100

21-Oct Telepone Expense $ 30


Telephone Payable $ 30
Part E (5 points each for a possible total of 50 points)
Record the following selected transactions for January in a two-column journal, identifying each entry by letter:

a.Earned $7,000 fees; customer will pay later.


b.Purchased equipment for $45,000, paying $20,000 in cash and the remainder on credit
c.Paid $3,000 for rent for January.
d.Purchased $2,500 of supplies on account.
e.A. Allen $1,000 investment in the company.
f.Received $7,000 in cash for fees earned previously.
g.Paid $1,200 to creditors on account.
h.Paid wages of $6,250.
i.Received $7,150 from customers on account.
j.A. Allen withdrawal of $1,750.

Date Particulars Debit Credit

a Accounts Receivable $ 7,000


Sales $ 7,000
to record sales on accoun

b Equipment $ 45,000
Cash $ 20,000
Accounts Payable $ 25,000
To record the purchase of equipment

c Rent Expense $ 3,000


Cash $ 3,000
To record the rent expense

d Supplies $ 2,500
Accounts Payable $ 2,500
To record the purchase of supplies

e Cash $ 1,000
Capital $ 1,000
To record the investment

f Cash $ 7,000
Accounts Receivable $ 7,000
To record the cash received

g Accounts Payable $ 1,200


Cash $ 1,200
To record the payment made to creditors
h Wages expense $ 6,250
Cash $ 6,250
To record the payment of wages

i Cash $ 7,150
Accounts Receivable $ 7,150
To record the cash received

j Capital $ 1,750
Cash $ 1,750
To record the withdrawal
h entry by letter:
Part F

1.(10 points) From the following items in the income statement columns of the worksheet of Friend's Tutoring at December 31
closing entries without explanation, assuming that a $1,000 withdrawal was made during the period.

Income Statement
Account Debit Credit
Tutoring Fees 3,450 3450
Wages Expense 700 700
Rent Expense 600 600
Supplies Expense 450 450
Insurance Expense 250 250
2000 3450
Net Income 1450
3450 3450

Date Particulars Debit Credit

31-Dec Tutoring fee $ 3,450


Income statement $ 3,450

31-Dec Income statement $ 700


Wages Expense $ 700

31-Dec Income statement $ 600


Rent Expense $ 600

31-Dec Income statement $ 450


Supplies Expense $ 450

31-Dec Income statement $ 250


Insurance Expense $ 250

31-Dec Income statement $ 1,450


Capital $ 1,450

31-Dec Capital $ 1,000


Cash $ 1,000
nd's Tutoring at December 31, prepare the
riod.
2. (5 points each for a possible total of 20 points) A summary of selected ledger accounts appear below for S. Ball for

2.(5 points each for a possible total of 20 points) A summary of selected ledger accounts appear below for S. Ball for the curren

Answer the following questions.


a.What was the total amount of withdrawals for the year?
$ 6,500
b.What was the net income?
$ 4,250
c.What was the total revenue?
$ 17,000
d.What were the total expenses?
$ 12,750
ts appear below for S. Ball for the current calendar year.

ar below for S. Ball for the current calendar year.

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