Question

On July 31, 2022, the general ledger of Sunland Legal Services Inc. showed the following balances: Cash $3,520, Accounts Receivable $1,320, Supplies $440, Equipment $4,400, Accounts Payable $3,610, Common Stock $3,080, and Retained Earnings $2,990. During August, the following transactions occurred.

Aug. 3		Collected $1,060 of accounts receivable due from customers.
5		Received $1,140 cash for issuing common stock to new investors.
6		Paid $2,380 cash on accounts payable.
7		Performed legal services of $5,720, of which $2,640 was collected in cash and the remainder was due on account.
12		Purchased additional equipment for $1,060, paying $350 in cash and the balance on account.
14		Paid salaries $3,080, rent $790, and advertising expenses $240 for the month of August.
18		Collected the balance for the services performed on August 7.
20		Paid cash dividend of $440 to stockholders.
24		Billed a client $880 for legal services performed.
26		Received $1,760 from Laurentian Bank; the money was borrowed on a bank note payable that is due in 6 months.
27		Agreed to perform legal services for a client in September for $3,960. The client will pay the amount owing after the services have been performed.
28		Received the utility bill for the month of August in the amount of $240; it is not due until September 15.
31		Paid income tax for the month $440.

a. Using T-accounts, enter the beginning balances to the ledger.

b. Journalize the August transactions

c. Post the August journal entries to the ledger

d. Prepare a trial balance on August 31, 2022.

Answer 1