Journalizing transactions, posting journal entries to four-column accounts, and preparing a trial balance
Theodore McMahon opened a law office on April 1, 2018. During the first month of operations, the business completed the following transactions:
Apr. 1 McMahon contributed \(70,000 cash to the business, Theodore McMahon, Attorney. The business issued common stock to McMahon.
3 Purchased office supplies, \)1,100, and furniture, \(1,300, on account.
4 Performed legal services for a client and received \)2,000 cash.
7 Purchased a building with a market value of \(150,000, and land with a market value of \)30,000. The business paid \(40,000 cash and signed a note payable to the bank for the remaining amount.
11 Prepared legal documents for a client on account, \)400.
15 Paid assistant’s semimonthly salary, \(1,200.
16 Paid for the office supplies purchased on April 3 on account. 18 Received \)2,700 cash for helping a client sell real estate.
19 Defended a client in court and billed the client for \(1,700.
25 Received a bill for utilities, \)650. The bill will be paid next month.
28 Received cash on account, \(1,100.
29 Paid \)3,600 cash for a 12-month insurance policy starting on May 1.
29 Paid assistant’s semimonthly salary, \(1,200.
30 Paid monthly rent expense, \)2,100.
30 Paid cash dividends of $3,200.
Requirements 1. Record each transaction in the journal, using the following account titles: Cash; Accounts Receivable; Office Supplies; Prepaid Insurance; Land; Building; Furniture; Accounts Payable; Utilities Payable; Notes Payable; Common Stock; Dividends; Service Revenue; Salaries Expense; Rent Expense; and Utilities Expense. Explanations are not required.
