Transaction Analysis, T Accounts, and Trial Balance

p3. Jennifer Polk opened a school for administrative skills called Polk Office Training, Inc., and completed the following transactions:

a.     Contributed the following assets to the business in exchange for 13,600 shares of $1 par value common stock:

 

 

 

 

 

b.     Found a location for her business and paid the first month’s rent, $260.

c.     Paid for an advertisement announcing the opening of the school, $190.

d.    Received applications from three students for a four-week secretarial program and two students for a ten-day keyboarding course. The students will be billed a total of $1,300.

e.     Purchased supplies on credit, $330.

f.      Billed the enrolled students, $1,740.

g.     Purchased a second-hand computer, $480, and office equipment, $380, on credit.

h.     Paid for the supplies purchased on credit in e, $330.

i.      Paid cash to repair a broken computer, $40.

j.      Received partial payment from students previously billed, $1,080.

k.     Paid the utility bill for the current month, $90.

l.      Paid an assistant one week’s salary, $440.

m.   Declared and paid a dividend of $200.

 

 

 

 

 

 

 

ReQUIReD

1.    Set up the following T accounts: Cash; Accounts Receivable; Supplies; Computers; Office Equipment; Accounts Payable; Common Stock; Dividends; Tuition Reve- nue; Salaries Expense; Utilities Expense; Rent Expense; Repair Expense; and Adver- tising Expense.

2.    Record the transactions directly in the T accounts, using the transaction letter to identify each debit and credit.

3.    Prepare a trial balance using today’s date.

4.    BusIness applICatIon ▶ Examine transactions f and j. What were the revenues, and how much cash was received from the revenues? What business issues might you see arising from the differences in these numbers?