Kimberly Manis, an architect, opened an office on January 1, 2016. During the mo

Question

Kimberly Manis, an architect, opened an office on January 1, 2016. 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 the business, $18,000. b. Paid January rent for office and workroom, $1,950. c. Purchased used automobile for $28,500, paying $5,700 cash and giving a note payable for the remainder. d. Purchased office and computer equipment on account, $4,500. e. Paid cash for supplies, $1,875. f. Paid cash for annual insurance policies, $3,600. g. Received cash from client for plans delivered, $13,650. h. Paid cash for miscellaneous expenses, $2,600. i. Paid cash to creditors on account, $3,000. j. Paid installment due on note payable, $950. k. Received invoice for blueprint service, due in February, $3,750. l. Recorded fees earned on plans delivered, payment to be received in February, $21,900. m. Paid salary of assistants, $4,100. n. Paid gas, oil, and repairs on automobile for January, $1,300. Required: 1. Record these transactions directly in the following T accounts, without journalizing: Cash; Accounts Receivable; Supplies; Prepaid Insurance; Automobiles; Equipment; Notes Payable; Accounts Payable; Kimberly Manis, Capital; Professional Fees; Salary Expense; Blueprint Expense; Rent Expense; Automobile Expense; Miscellaneous Expense. To the left of the amount entered in the accounts, select the 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 unadjusted trial balance for Kimberly Manis, Architect, as of January 31, 2016. 4. Determine the net income or net loss for January.

Explanation / Answer

T- accounts Cash debit credit a 18,000 b 1,950 g 13,650 c 5,700 e 1,875 f 3,600 h 2,600 i 3,000 j 950 m 4,100 n 1,300 balance 6,575 supplies e 1,875 prepaid insurance f 3,600 Accounts receivable l 21,900 blueprint expense k 3,750 Kimberly Mains capital Debit Credit a 18,000 Rent expense b 1,950 Automobile c 28,500 Notes payable j 950 c 22,800 balance 21,850

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