Learning Materials
Features
Discover
Chapter 2: Q16RQ (page 90)
If total debits equal total credits on the trial balance, is the trial balance error-free? Explain your answer.
There could be an error in the trial balance even if the debits and credits are equal.
Over 30 million students worldwide already upgrade their learning with Vaia!
All the tools & learning materials you need for study success - in one app.
Get started for free
What does a ledger show? What’s the difference between a ledger and a chart of accounts?
Question: The following transactions occurred for Wilke Technology Solutions:
May 1 The business received cash of \(105,000 and issued common stock to Zoe Wilke.
2 Purchased office supplies on account, \)550.
4 Paid \(57,000 cash for building and land. The building had a fair market value of \)45,000.
6 Performed services for customers and received cash, \(3,600.
9 Paid \)350 on accounts payable.
17 Performed services for customers on account, \(3,500.
19 Paid rent expense for the month, \)1,200.
20 Received \(1,500 from customers for services to be performed next month.
21 Paid \)900 for advertising in next month’s IT Technology magazine.
23 Received \(3,100 cash on account from a customer.
31 Incurred and paid salaries, \)1,700.
Analyzing and journalizing transactions
Journalize the transactions of Wilke Technology Solutions. Include an explanation with each journal entry. Use the following accounts: Cash; Accounts Receivable; Office Supplies; Prepaid Advertising; Land; Building; Accounts Payable; Unearned Revenue; Common Stock; Service Revenue; Rent Expense; and Salaries Expense
Journalizing transactions, posting journal entries to four-column accounts, and preparing a trial balance
The trial balance of Shawn Merry, CPA, is dated March 31, 2018: During April, the business completed the following transactions:
Cash 11,000
Office Supplies 400
Accounts Receivable 16,500
Land 30,000
Furniture 0
Automobile 0
Accounts Payable 3,800
Unearned Revenue 0
Common Stock 52,300
Dividends 0
Rent Expense 800
Salaries Expense 5,600
Service Revenue 8,200
Total Balance \( 64,300 64,300
During April, the business completed the following transactions:
Apr. 4 Collected \)2,500 cash from a client on account.
8 Performed tax services for a client on account, \(5,400.
13 Paid \)3,000 on account.
14 Purchased furniture on account, \(3,600.
15 Merry contributed his personal automobile to the business in exchange for common stock. The automobile had a market value of \)9,500.
18 Purchased office supplies on account, \(900.
19 Received \)2,700 for tax services performed on April 8.
20 Paid cash dividends of \(6,500.
21 Received \)5,700 cash for consulting work completed.
24 Received \(2,400 cash for accounting services to be completed next month.
27 Paid office rent, \)600.
28 Paid employee salary, $1,700.
Requirements
Using the following accounts and their balances, calculate the debt ratio for Cooper Furniture Repair as of December 31.
Cash \( 7,000 Advertising Expense \) 1,200
Unearned Revenue 4,500 Utilities Expense 800
Equipment 10,000 Rent Expense 5,000
Service Revenue 8,000 Accounts Payable 2,300
Common Stock 12,200 Dividends 3,000
Your friend, Dean McChesney, requested that you advise him on the effects that certain transactions will have on his business, A-Plus Travel Planners. Time is short, so you cannot journalize the transactions. Instead, you must analyze the transactions without a journal. McChesney will continue the business only if he can expect to earn a monthly net income of \(6,000. The business completed the following transactions during June:
a. McChesney deposited \)10,000 cash in a business bank account to start the company. The company issued common stock to McChesney.
b. Paid \(300 cash for office supplies.
c. Incurred advertising expense on account, \)700.
d. Paid the following cash expenses: administrative assistant’s salary, \(1,400; office rent, \)1,000.
e. Earned service revenue on account, \(8,800.
f. Collected cash from customers on account, \)1,200.
Requirements
2. Post the transactions directly to the accounts without using a journal. Record each transaction by letter. Calculate account balances.
What do you think about this solution?
We value your feedback to improve our textbook solutions.
Explanations 
Textbooks 
Exams 
GCSE 
IGCSE 
AS 
A Level 
International A Level 
University Admissions Tests 
Flashcards 
Vaia AI 
Notes 
Study Plans 
Study Sets 
Find a job 
Find a degree 
Student Deals 
Magazine 
Mobile App