Reference no: EM132679487

Problem - Entries into T accounts and trial balance

Leila Durkin, an architect, opened an office on May 1, 2012. During the month, she completed the following transactions connected with her professional corporation, Lelia Durkin Architect, P.C.

a. Transferred cash from a personal bank account to an account to be used for the business in exchange for capital stock, $30,000.

b. Paid May rent for office and workroom, $3,500.

c. Purchased used automobile for $25,000, paying $5,000 cash and giving a note payable for the remainder.

d. Purchased office and computer equipment on account, $9,000.

e. Paid cash for supplies, $1,200.

f. Paid cash for annual insurance policies, $2,400.

g. Received cash from client for plans delivered, $8,150.

h. Paid cash for miscellaneous expenses, $300.

i. Paid cash to creditors on account, $2,500.

j. Paid installment due on note payable, $400.

k. Received invoice for blueprint service, due in June, $1,200.

l. Recorded fee earned on plans delivered, payment to be received in June, $12,900.

m. Paid salary of assistant, $1,800.

n. Paid gas, oil, and repairs on automobile for May, $600.

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; Capital Stock; Professional Fees; Rent Expense; Salary Expense; Blueprint Expense; Automobile Expense; Miscellaneous Expense. To the left of the 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 Leila Durkin, Architect, P.C., as of May 31, 2012.

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