Question

The accountant for the firm owned by Randy Guttery prepares financial statements at the end of each month. The following transactions for Randy Guttery, Landscape Consultant took place during the month ended June 30, 2019. The following transactions are for Randy Guttery, Landscape Consultant.

Transactions:

Guttery invested $80,000 in cash to start the business.

Paid $3,000 for the current month’s rent.

Bought office furniture for $8,360 in cash.

Performed services for $4,100 in cash.

Paid $625 for the monthly telephone bill.

Performed services for $7,000 on credit.

Purchased a computer and copier for $19,000; paid $6,500 in cash immediately with the balance due in 30 days.

Received $3,500 from credit clients.

Paid $2,000 in cash for office cleaning services for the month.

Purchased additional office chairs for $2,900; received credit terms of 30 days.

Purchased office equipment for $20,000 and paid half of this amount in cash immediately; the balance is due in 30 days.

Issued a check for $4,700 to pay salaries.

Performed services for $7,250 in cash.

Performed services for $8,000 on credit.

Collected $4,000 on accounts receivable from charge customers.

Issued a check for $1,450 in partial payment of the amount owed for office chairs.

Paid $350 to a duplicating company for photocopy work performed during the month.

Paid $610 for the monthly electric bill.

Guttery withdrew $4,500 in cash for personal expenses.

Post the above transactions into the appropriate T accounts.

Analyze:
What liabilities does the business have after all transactions have been recorded? T accounts normally do not have any minus signs. Use minus signs in this problem to demonstrate your understanding of decreases to account balances.

	Cash Accounts Receivable Bal. Bal. Office Equipment Office Furniture Bal. Bal. Accounts Payable Randy Guttery, Capital Bal. Bal. Randy Guttery, Drawing Fees Income Bal. Bal. Rent Expense Utilities Expense Bal. Bal. Salaries Expense Telephone Expense Bal. Bal. Miscellaneous Expense Bal. This is a numeric cell, so please enter numbers only.

Answer 1

Cash					Accounts Receivable
	Debit	Credit				Debit	Credit
1	80000	3000	2	-1	6	7000	3500	8
4	4100	8360	3		14	8000	4000	15
8	3500	625	5		Balance		7500
13	7250	6500	7			15000	15000
15	4000	2000	9
		10000	11
		4700	12
		1450	16
		350	17
		610	18
		4500	19
Balance		56755
	98850	98850
Office Equipment					Office Furniture
	Debit	Credit				Debit	Credit
7	19000				3	8360
11	20000				10	2900
Balance		39000			Balance		11260
	39000	39000				11260	11260
Accounts Payable					Randy Guttery , Capital
	Debit	Credit				Debit	Credit
16	1450	12500	7				80000	1
		2900	10
		10000	11
Balance	23950				Balance	80000
	25400	25400				80000	80000
Randy Guttery , Drawing					Fees Income
	Debit	Credit				Debit	Credit
19	4500						4100	4
							7000	6
							7250	13
Balance		4500					8000	14
	4500	4500			Balance	26350
						26350	26350
Rent Expense					Utility Expense
	Debit	Credit				Debit	Credit
2	3000				18	610
Balance		3000			Balance		610
	3000	3000				610	610
Salaries Expense					Telephone Expense
	Debit	Credit				Debit	Credit
12	4700				5	625
Balance		4700			Balance		625
	4700	4700				625	625
Miscelleneous Expense
	Debit	Credit
9	2000
17	350
Balance		2350
	2350	2350

Liabilities will be 23950 in the form of Accounts Payable.