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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

ANALYSIS OF TRANSACTIONS Nicole Lawrence opened a business called Nickie’s Neat Ideas in January 20--. Set up T accounts for the following accounts: Cash; Accounts Receivable; Office Supplies; Computer Equipment; Office Furniture; Accounts Payable; Nicole Lawrence, Capital; Nicole Lawrence, Drawing; Professional Fees; Rent Expense; and Utilities Expense.

The following transactions occurred during the first month of business. Record these transactions in T accounts. After all transactions have been recorded, foot and balance the accounts if necessary.

  1. (a) Invested cash in the business, $18,000.
  2. (b) Purchased office supplies for cash, $500.
  3. (c) Purchased office furniture for cash, $8,000.
  4. (d) Purchased computer and printer on account, $5,000.
  5. (e) Received cash from clients for services, $4,000.
  6. (f) Paid cash on account for computer and printer purchased in transaction (d), $2,000.
  7. (g) Earned professional fees on account during the month, $7,000.
  8. (h) Paid office rent for January, $900.
  9. (i) Paid utility bills for the month, $600.
  10. (j) Received cash from clients that were billed previously in transaction (g), $3,000.
  11. (k) Withdrew cash for personal use, $4,000.

To determine

Record the given transactions in T accounts and foot the balance of T accounts.

Explanation

Analysis of transactions: A transaction refers to any business event that affects assets, liabilities and stockholders’ equity or owner’s equity which can be measured in monetary terms.

T-account: The condensed form of a ledger is referred to as T-account...

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