Expert Answers

Expert Answers

Scenario: Use following scenario and transactions to complete the activities below. 

On January 4, Mary Markham, an attorney, opened her private law firm…Markham Law (ML). The following transactions were completed during the month.  

1) Mary invested $30,000 cash and $15,000 of office equipment in the business in exchange for capital stock. 

2) ML paid a month’s rent of $1800  

3) ML paid $1200 for office supplies  

4) ML collected $20,000 of legal fees for services performed  

5) ML paid a secretary salary of $2200  

6) ML purchased $500 of supplies on account  

7) ML bought an auto for business use. It cost $15,000. ML paid $4000 down and 
charged the balance(on credit). 
8) ML paid $4000 of dividends  

9) ML paid $900 for auto maintenance and repairs 

10) ML received a telephone bill for $300  

11) ML paid the telephone bill  

12) ML paid premiums of $1200 for one year insurance  

13) ML paid $2500 for a computer  

14) ML paid $700 for a cleaning service  

15) ML received $5000 on retainer(advanced payment for the services to be rendered in the future) from MOB INC  

Activities: Using the scenario and transactions above, complete the following activities.

1. Record the transactions in T accounts.(make sure that you number each transaction and use the account names that listed below) 

2. Prepare a trial balance for the end of the month.  



Office Supplies

Prepaid Insurance

Office Equipment



Accounts Payable

Note Payable

Unearned Revenue

Capital Stock


Earned Revenue

Auto Expense

Rent Expense

Salary Expense

Utility Expense

Cleaning Expense
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