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D. Johnston, a physical therapist, opened Johnston’s Clinic. His accountant provided the following chart of accounts: The following transactions occurred during July of this year: a. Johnston deposited $35,000 in a bank account in the name of the business. b. Bought filing cabinets on account from Muller Office Supply, $560. c. Paid cash for chairs and carpeting for the waiting room, $835, Ck. No. 1000. d. Bought a photocopier from Rob’s Office Equipment, $650, paying $250 in cash and placing the balance on account, Ck. No. 1001. e. Received and paid the telephone bill, which included installation charges, $185, Ck. No. 1002. f. Sold professional services on account, $2,255. g. Received and paid the bill for the state physical therapy convention, $445, Ck. No. 1003. h. Received and paid the electric bill, $335, Ck. No. 1004. i. Received cash on account from credit customers, $1,940. j. Paid on account to Muller Office Supply, $250, Ck. No. 1005. k. Paid the office rent for the current month, $1,245, Ck. No. 1006. l. Sold professional services for cash, $1,950. m. Paid the salary of the receptionist, $960, Ck. No. 1007. n. Johnston withdrew cash for personal use, $1,200, Ck. No. 1008. Required 1. Record the owner’s name in the Capital and Drawing T accounts. 2. Correctly place the plus and minus signs for each T account and label the debit and credit sides of the accounts. 3. Record the transactions in the T accounts. Write the letter of each entry to identify the transaction. 4. Foot the T accounts and show the balances. 5. Prepare a trial balance as of July 31, 20--. 6. Prepare an income statement for July 31, 20--. 7. Prepare a statement of owner’s equity for July 31, 20--. 8. Prepare a balance sheet as of July 31, 20--.

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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
Publisher: South-Western College Pub
ISBN: 9781337280570
BuyFind

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
Publisher: South-Western College Pub
ISBN: 9781337280570

Solutions

Chapter
Section
Chapter 2, Problem 3PB
Textbook Problem

D. Johnston, a physical therapist, opened Johnston’s Clinic. His accountant provided the following chart of accounts:

Chapter 2, Problem 3PB, D. Johnston, a physical therapist, opened Johnstons Clinic. His accountant provided the following

The following transactions occurred during July of this year:

  1. a. Johnston deposited $35,000 in a bank account in the name of the business.
  2. b. Bought filing cabinets on account from Muller Office Supply, $560.
  3. c. Paid cash for chairs and carpeting for the waiting room, $835, Ck. No. 1000.
  4. d. Bought a photocopier from Rob’s Office Equipment, $650, paying $250 in cash and placing the balance on account, Ck. No. 1001.
  5. e. Received and paid the telephone bill, which included installation charges, $185, Ck. No. 1002.
  6. f. Sold professional services on account, $2,255.
  7. g. Received and paid the bill for the state physical therapy convention, $445, Ck. No. 1003.
  8. h. Received and paid the electric bill, $335, Ck. No. 1004.
  9. i. Received cash on account from credit customers, $1,940.
  10. j. Paid on account to Muller Office Supply, $250, Ck. No. 1005.
  11. k. Paid the office rent for the current month, $1,245, Ck. No. 1006.
  12. l. Sold professional services for cash, $1,950.
  13. m. Paid the salary of the receptionist, $960, Ck. No. 1007.
  14. n. Johnston withdrew cash for personal use, $1,200, Ck. No. 1008.

Required

  1. 1. Record the owner’s name in the Capital and Drawing T accounts.
  2. 2. Correctly place the plus and minus signs for each T account and label the debit and credit sides of the accounts.
  3. 3. Record the transactions in the T accounts. Write the letter of each entry to identify the transaction.
  4. 4. Foot the T accounts and show the balances.
  5. 5. Prepare a trial balance as of July 31, 20--.
  6. 6. Prepare an income statement for July 31, 20--.
  7. 7. Prepare a statement of owner’s equity for July 31, 20--.
  8. 8. Prepare a balance sheet as of July 31, 20--.

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Chapter 2 Solutions

College Accounting (Book Only): A Career Approach
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