Ken Jones, an architect, opened an office on April 1, 2014

Ken Jones, an architect, opened an office on April 1, 2014. During the month, he completed the following transactions connected with his professional practice:

a. Transferred cash from a personal bank account to an account to be used for the business, $18,000.

b. Purchased used automobile for $19,500, paying $2,500 cash and giving a note payable for the remainder.

c. Paid April rent for office and workroom, $3,150.

d. Paid cash for supplies, $1,450.

e. Purchased office and computer equipment on account, $6,500.

f. Paid cash for annual insurance policies on automobile and equipment, $2,400.

g. Received cash from a client for plans delivered, $12,000.

h. Paid cash to creditors on account, $1,800.

i. Paid cash for miscellaneous expenses, $375.

j. Received invoice for blueprint service, due in May, $2,500.

k. Recorded fee earned on plans delivered, payment to be received in May, $15,650.

l. Paid salary of assistant, $2,800.

m. Paid cash for miscellaneous expenses, $200.

n. Paid installment due on note payable, $300.

o. Paid gas, oil, and repairs on automobile for April, $550.

Instructions

1. Record the above transactions directly in the following T accounts, without journalizing: Cash; Accounts Receivable; Supplies; Prepaid Insurance; Automobiles; Equipment; Notes Payable; Accounts Payable; Ken Jones, Capital; Professional Fees; Rent Expense; Salary Expense; Blueprint Expense; Automobile Expense; Miscellaneous Expense. To the left of each amount entered in the accounts, place the appropriate letter to identify the transaction.

2. Determine account balances of the T accounts. Accounts containing a single entry only (such as Prepaid Insurance) do not need a balance.

3. Prepare an unadjusted trial balance for Ken Jones, Architect, as of April 30, 2014.

4. Determine the net income or net loss for April.


Answer:


(b) 2,500 (h) 1,800 (e) 6,500
(g) 12,000 (c) 3,150 (j) 2,500
(d) 1,450 Bal. 7,200
(f) 2,400
(h) 1,800 Ken Jones, Capital
(i) 375 (a) 18,000
(l) 2,800
(m) 200 Professional Fees
(n) 300 (g) 12,000
(o) 550 (k) 15,650
Bal. 14,475 Bal. 27,650
Accounts Receivable Rent Expense
(k) 15,650 (c) 3,150
Prob. 2–1B
1. and 2.
Cash
Supplies
Accounts Payable
Salary Expense
(d) 1,450 (l) 2,800
Prepaid Insurance Blueprint Expense
(f) 2,400 (j) 2,500
Automobiles Automobile Expense
(b) 19,500 (o) 550
Equipment Miscellaneous Expense
(e) 6,500 (i) 375
(m) 200
Notes Payable
(n) 300 (b) 17,000
Bal. 16,700
KEN JONES, ARCHITECT
Unadjusted Trial Balance
April 30, 2014
Debit
Balances
Credit
Balances
Cash 14,475
Accounts Receivable 15,650
Supplies 1,450
Prepaid Insurance 2,400
Automobiles 19,500
Equipment 6,500
Notes Payable 16,700
Accounts Payable 7,200
Ken Jones, Capital 18,000
Professional Fees 27,650
Rent Expense 3,150
Salary Expense 2,800
Blueprint Expense 2,500
Automobile Expense 550
Miscellaneous Expense 575
69,550 69,550
Prob. 2–1B (Concluded)
3.
4. Net income, $18,075 ($27,650 – $3,150 – $2,800 – $2,500 – $550 – $575)