Reference no: EM133104171

Question - On July 31, 2022, the general ledger of Sheridan Legal Services Inc. showed the following balances: Cash $4,400, Accounts Receivable $1,650, Supplies $550, Equipment $5,500, Accounts Payable $4,510, Common Stock $3,850, and Retained Earnings $3,740. During August, the following transactions occurred.

Aug. 3 Collected $1,320 of accounts receivable due from customers.

Aug. 5 Received $1,430 cash for issuing common stock to new investors.

Aug. 6 Paid $2,970 cash on accounts payable.

Aug. 7 Performed legal services of $7,150, of which $3,300 was collected in cash and the remainder was due on account.

Aug. 12 Purchased additional equipment for $1,320, paying $440 in cash and the balance on account.

Aug. 14 Paid salaries $3,850, rent $990, and advertising expenses $305 for the month of August.

Aug. 18 Collected the balance for the services performed on August 7.

Aug. 20 Paid cash dividend of $550 to stockholders.

Aug. 24 Billed a client $1,100 for legal services performed.

Aug. 26 Received $2,200 from Laurentian Bank; the money was borrowed on a bank note payable that is due in 6 months.

Aug. 27 Agreed to perform legal services for a client in September for $4,950. The client will pay the amount owing after the services have been performed.

Aug. 28 Received the utility bill for the month of August in the amount of $305; it is not due until September 15.

Aug. 31 Paid income tax for the month $550.

Required -

(a) Using T-accounts, enter the beginning balances to the ledger.

(b) Journalize the August transactions.

(c) Post the August journal entries to the ledger.

(d) Prepare a trial balance on August 31, 2022.