Reference no: EM131528146
Question: Business transactions completed by Eric Pense during the month of September are as follows.
a. Pense invested $23,000 cash along with office equipment valued at $12,000 in a new sole proprietorship named EP Consulting.
b. The company purchased land valued at $8,000 and a building valued at $33,000. The purchase is paid with $15,000 cash and a long-term note payable for $26,000.
c. The company purchased $600 of office supplies on credit.
d. Pense invested his personal automobile in the company. The automobile has a value of $7,000 and is to be used exclusively in the business.
e. The company purchased $1,100 of additional office equipment on credit.
f. The company paid $800 cash salary to an assistant.
g. The company provided services to a client and collected $2,700 cash.
h. The company paid $430 cash for this month's utilities.
i. The company paid $600 cash to settle the account payable created in transaction c.
j. The company purchased $4,000 of new office equipment by paying $4,000 cash.
k. The company completed $2,400 of services for a client, who must pay within 30 days.
l. The company paid $800 cash salary to an assistant.
m. The company received $1,000 cash in partial payment on the receivable created in transaction k.
n. Pense withdrew $1,050 cash from the company for personal use.
Required: 1. Prepare general journal entries to record these transactions (use account titles listed in part 2).
2. Open the following ledger accounts-their account numbers are in parentheses (use the balance column format): Cash (101); Accounts Receivable (106); Office Supplies (108); Office Equipment (163); Automobiles (164); Building (170); Land (172); Accounts Payable (201); Notes Payable (250); E. Pense, Capital (301); E. Pense, Withdrawals (302); Fees Earned (402); Salaries Expense (601); and Utilities Expense (602). Post the journal entries from part 1 to the ledger accounts and enter the balance after each posting.
3. Prepare a trial balance as of the end of September.