On August 1, 2019, Rafael Masey established Planet Realty, which completed the following transactions during the month: Rafael Masey transferred cash from a personal bank account to an account to be used for the business, $17,500. Purchased supplies on account, $2,300. Earned fees, receiving cash, $13,300. Paid rent on office and equipment for the month, $3,000. Paid creditor on account, $1,150. Withdrew cash for personal use, $1,800. Paid automobile expenses (including rental charge) for month, $1,500, and miscellaneous expenses, $400. Paid office salaries, $2,800. Determined that the cost of supplies used was $1,050. Required: 1. Journalize entries for transactions (a) through (i), using the following account titles: Cash; Supplies; Accounts Payable; Rafael Masey, Capital; Rafael Masey, Drawing; Fees Earned; Rent Expense; Office Salaries Expense; Automobile Expense; Supplies Expense; Miscellaneous Expense. For a compound transaction, if an amount box does not require an entry, leave it blank. 2. Prepare T accounts, using the account titles in (1). Post (in chronological order) the journal entries to these accounts, selecting the appropriate letter to the left of each amount to identify the transactions. Determine the account balances, after all posting is complete. Accounts containing only a single entry do not need a balance. 3. Prepare an unadjusted trial balance as of August 31, 2019. For those boxes in which no entry is required, leave the box blank. 4. Determine the following: a. Amount of total revenue recorded in the ledger. b. Amount of total expenses recorded in the ledger. c. Amount of net income for August. 5. Determine the increase or decrease in owner's equity for August.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

On August 1, 2019, Rafael Masey established Planet Realty, which completed the following transactions during the month:

Rafael Masey transferred cash from a personal bank account to an account to be used for the business, $17,500.
Purchased supplies on account, $2,300.
Earned fees, receiving cash, $13,300.
Paid rent on office and equipment for the month, $3,000.
Paid creditor on account, $1,150.
Withdrew cash for personal use, $1,800.
Paid automobile expenses (including rental charge) for month, $1,500, and miscellaneous expenses, $400.
Paid office salaries, $2,800.
Determined that the cost of supplies used was $1,050.

Required:

1. Journalize entries for transactions (a) through (i), using the following account titles: Cash; Supplies; Accounts Payable; Rafael Masey, Capital; Rafael Masey, Drawing; Fees Earned; Rent Expense; Office Salaries Expense; Automobile Expense; Supplies Expense; Miscellaneous Expense. For a compound transaction, if an amount box does not require an entry, leave it blank.

2. Prepare T accounts, using the account titles in (1). Post (in chronological order) the journal entries to these accounts, selecting the appropriate letter to the left of each amount to identify the transactions. Determine the account balances, after all posting is complete. Accounts containing only a single entry do not need a balance.

3. Prepare an unadjusted trial balance as of August 31, 2019. For those boxes in which no entry is required, leave the box blank.

4. Determine the following:

a. Amount of total revenue recorded in the ledger.

b. Amount of total expenses recorded in the ledger.

c. Amount of net income for August.

5. Determine the increase or decrease in owner's equity for August.

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