THE SMITH COMPANY Using the business transactions below, complete T-accounts for the Smith Company. I have provided a blank sheet of t-accounts as an attachment to this assignment. The company started business on June 1, 2019. a. John Smith, owner, invested $120,000 cash in the company. b. The company purchased $10,000 of office equipment on credit. c. The company billed a customer $2,000 as fees for services provided. d. The company paid $1,000 cash for the monthly rent. e. The company purchased office supplies for $500 cash. f. The company paid $300 for the utilities for the month. g. The company received $15,000 cash as fees for services provided to a customer. h. The company paid the secretary's salary for the month, $3,000. i. John Smith withdrew $6,000 cash from the company for personal use. As you work this problem, be sure to label entries with the appropriate "letter" associated with the transaction. Also, be sure to compute the T-account balances when all transactions have been posted to the T-accounts. Use the Chart of Accounts provided for account names. CHART OF ACCOUNTS EQUITY J. Smith, Capital J. Smith, Drawing ASSETS EXPENSES Cash Accounts Receivable Office Supplies Office Equipment Rent Expense Utilities Expense Salary Expense Miscellaneous Expense REVENUES Service Fees Earned LIABILITIES Accounts Payable

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
Question 5
THE SMITH COMPANY
Using the business transactions below, complete T-accounts for the Smith Company. I have provided
a blank sheet of t-accounts as an attachment to this assignment. The company started business on
June 1, 2019.
a. John Smith, owner, invested $120,000 cash in the company.
b. The company purchased $10,000 of office equipment on credit.
c. The company billed a customer $2,000 as fees for services provided.
d. The company paid $1,000 cash for the monthly rent.
e. The company purchased office supplies for $500 cash.
f. The company paid $300 for the utilities for the month.
g. The company received $15,000 cash as fees for services provided to a customer.
h. The company paid the secretary's salary for the month, $3,000.
i. John Smith withdrew $6,000 cash from the company for personal use.
As you work this problem, be sure to label entries with the appropriate "letter" associated with the
transaction. Also, be sure to compute the T-account balances when all transactions have been
posted to the T-accounts. Use the Chart of Accounts provided for account names.
CHART OF ACCOUNTS
ASSETS
EQUITY
J. Smith, Capital
J. Smith, Drawing
EXPENSES
Cash
Accounts Receivable
Office Supplies
Office Equipment
Rent Expense
Utilities Expense
Salary Expense
Miscellaneous Expense
REVENUES
Service Fees Earned
LIABILITIES
Accounts Payable
Transcribed Image Text:THE SMITH COMPANY Using the business transactions below, complete T-accounts for the Smith Company. I have provided a blank sheet of t-accounts as an attachment to this assignment. The company started business on June 1, 2019. a. John Smith, owner, invested $120,000 cash in the company. b. The company purchased $10,000 of office equipment on credit. c. The company billed a customer $2,000 as fees for services provided. d. The company paid $1,000 cash for the monthly rent. e. The company purchased office supplies for $500 cash. f. The company paid $300 for the utilities for the month. g. The company received $15,000 cash as fees for services provided to a customer. h. The company paid the secretary's salary for the month, $3,000. i. John Smith withdrew $6,000 cash from the company for personal use. As you work this problem, be sure to label entries with the appropriate "letter" associated with the transaction. Also, be sure to compute the T-account balances when all transactions have been posted to the T-accounts. Use the Chart of Accounts provided for account names. CHART OF ACCOUNTS ASSETS EQUITY J. Smith, Capital J. Smith, Drawing EXPENSES Cash Accounts Receivable Office Supplies Office Equipment Rent Expense Utilities Expense Salary Expense Miscellaneous Expense REVENUES Service Fees Earned LIABILITIES Accounts Payable
Expert Solution
Step 1

T Accounts 

 

1. Cash Account

Particular Debit Particular Credit
       
To capital A/c 120,000 By rent 1,000
To service Revenue 15,000 By cash 500
    By utility Expense 300
    By salary 3,000
    By drawing 6,000
    By Balance C/d 124,200
       
Total 135,000 Total 135,000

 

2. Capital A/c 

 

Particular debit Particular Credit
       
To Balance C/d 120,000 By cash 120,000
       
Total 120,000 Total 120,000

 

 

3. Office Equipment

 

Particular Debit Particular Credit
       
To Accounts payable 10,000 By balance C/d 10,000
       
Total 10,000 Total 10,000

 

 

4. Accounts payable

 

Particular Debit Particular Credit
       
To Balance C/d 10,000 By office equipment 10,000
       
Total 10,000 Total 10,000

 

 

5. Accounts receivable 

 

Particular Debit Particular Credit
       
To Service Revenue 2,000 By Balance C/d 2,000
       
Total 2,000 Total 2,000

 

 

6. Service Revenue 

 

Particular Debit Particular Credit
       
By Profit and loss A/c 17,000 By Accounts receivable 2,000
    By Cash 15,000
       
Total 17,000 Total 17,000

 

 

 

 

 

 

 

trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Market Efficiency
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education