Hannah Knox, an architect, opened an office on July 1, 2008. During the month, she completed the following transactions connected with her professional practice:
(a) Transferred cash from a personal bank account to an account to be used for business $25,000
(b) Paid July rent for office and workroom, $2,000
(c) Purchased used automobile for $16,500, paying $1,500 cash and giving a note payable for the remainder.
(d) Purchased office and computer equipment on account, $,6,500
(e) Paid cash for supplies, $975
(f) Paid cash for annual insurance policies, $1,200
(g) Received cash from client for plans delivered, $3,750
(h) Paid cash for miscellaneous expenses, $240
(i) Paid cash to creditors on account, $2,500
(j) Paid installment due on note payable, $450
(k) Received invoice for blueprint service, due in August, $750
(l) Recorded fee earned on plans delivered, payment to be received in August, $3,150
(m) Paid salary of assistant, $1,500
(n) Paid gas, oil, and repairs on automobile for July, $280
Instructions:
1. Record the above transaction directly in the following T accounts without journalizing: cash, account receivable, supplies, prepaid insurance, automobile, equipment, notes payable, account payable, Hannah Knox capital, professional fees, rents expense, salary expense, automobile expense, blueprint expense, Miscellaneous expense. To the left of the amount entered in the accounts, place appropriate letter to identify the transaction.
2. Determine account balances of the T accounts. Accounts containing a single entry only (such as prepaid Insurance) do not need a balance.
3. Prepare an adjusted trial balance for Hannah Knox, Architect, as of July 31, 2008
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