Town Architects incorporated as licensed architects on April 1, 2012. During the first month of the operation of the business, these events and transactions occurred.
Apr.1 Stockholders invested $18,000 in cash in exchange for common stock for the corporation
1 Hired a secretary-receptionist as a salary of $375 per week, payable monthly
2 Paid office rent for the month $900
3 Purchased architectural supplies on account from Spring Green Company $1,300
10 Completed blueprints on a carport and billed client $1,900 for services
11 Received $700 cash advance from J. Madison to design a new home
20 Received $2,800 cash for services completed and delivered to M. Svetlana
30 Paid secretary-receptionist for the month $1,500
30 Paid $300 to Spring Green Company for accounts payable due
The company uses these accounts: Cash, Accounts Receivable, Supplies, Accounts Payable, Unearned Service Revenue, Common Stock, Service Revenue, Salaries and Wages Expense, and Rent Expense.
a) Journalize the transactions, including explanations
b) Post to the ledger T accounts
c) Prepare a trial balance on April 30, 2012
This solution illustrates how to journalize transactions, post them to T-accounts, and use the T-accounts to post the account balances to the trial balance.