Acc290 Financial Accounting Week 2 (E3-4, E3-9, P3-5A, P3-6A)

Acc290 Financial Accounting
Week 2 Assignment (E3-4, E3-9, P3-5A, P3-6A)
E3-4 Witten Company
E3-9 Pickert Real Estate Agency
P3-5A Sunflower Architects Incorporated
P3-6A Slocombe Company

E3-4
A tabular analysis of the transactions made during August 2010 by Witten Company during its first month of operations is shown below. Each increase and decrease in stockholders' equity is explained. ASSETS LIABILITIES STOCKHOLDERS' EQUITY
Cash Accounts Rec. Supplies Office Equipment Accounts Payable Common Stock Retained Earnings
Revenue Expense Dividends
1 20,000 20,000 Com. Stock
2 (1,000) 5,000 4,000
3 (750) 750
4 4,400 5,400 9,800 Serv. Rev
5 (1,500) (1,500)
6 (2,000) (2,000) Div.
7 (800) (800) Rent Exp.
8 450 (450)
9 (3,000) (3,000) Sal. Exp.
10 500 (500) Util. Exp.

Instructions
(a) Describe each transaction.
(b) Determine how much stockholders’ equity increased for the month.
(c) Compute the net income for the month.

E3-9
Transaction data and journal entries for Pickert Real Estate Agency are presented in E3-7 and E3-8.
Oct. 1 Stockholders invested $30,000 in exchange for common stock of the corporation.
Oct. 2 Hires an administrative assistant at an annual salary of $42,000.
Oct. 3 Buys office furniture for $4,600, on account.
Oct. 6 Sells a house and lot for M.E. Petty; commissions due from Petty, $10,800 (not paid by Petty at this time).
Oct. 10 Receives cash of $140 as commission for acting as rental agent renting an apartment.
Oct. 27 Pays $700 on account for the office furniture purchased on October 3.
Oct. 30 Pays the administrative assistant $3,500 in salary for October.

Instructions
(a) Post the transactions to T accounts.
(b) Prepare a trial balance at October 31, 2010.

P3-5A
Sunflower Architects Incorporated as licensed architects on April 1, 2010. During the first month of the operation of the business, these events and transactions occurred:
1-Apr Stockholders invested $15,000 cash in exchange for common stock of the corporation.
1 Hired a secretary-receptionist at a salary of $375 per week, payable monthly.
2 Paid office rent for the month $900.
3 Purchased architectural supplies on account from Spring Green Company $1,000.
10 Completed blueprints on a carport and billed client $1,500 for services.
11 Received $500 cash advance from J. Madison to design a new home.
20 Received $2,300 cash for services completed and delivered to M. Svetlana.
30 Paid secretary-receptionist for the month $1,500.
30 Paid $300 to Spring Green Company for accounts payable due.

Instructions:
(a) Journalize the transactions, including explanations. (If no entry is required type No entry for the account and 0 for the amount.)
(b) Post to the ledger T accounts.
(c) Prepare a trial balance on April 30, 2010.

P3-6A
This is the trial balance of Slocombe Company on September 30.
SLOCOMBE COMPANY
Trial Balance
September 30, 2010
Debit Credit
Cash 8,300
Accounts Receivable 2,600
Supplies 2,100
Equipment 8,000
Accounts Payable 5,100
Unearned Revenue 900
Common Stock 15,000
21,000 21,000

The October transactions were as follows.
Oct. 5 Received $1,300 in cash from customers for accounts receivable due.
10 Billed customers for services performed $5,100.
15 Paid employee salaries $1,400.
17 Performed $600 of services for customers who paid in advance in August.
20 Paid $1,500 to creditors for accounts payable due.
29 Paid a $300 cash dividend.
31 Paid utilities $500.

Instructions
(a) Prepare a general ledger using T accounts. Enter the opening balances in the ledger accounts as of October 1. Provision should be made for these additional accounts: Dividends, Service Revenue, Salaries Expense, and Utilities Expense.
(b) Journalize the transactions, including explanations.
(c) Post to the ledger accounts.
(d) Prepare a trial balance on October 31, 2010.
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