Question

On October 1, 20Y6, Jay Crowley established Affordable Realty, which completed the following transactions during the month:

Oct.	1	Jay Crowley transferred cash from a personal bank account to an account to be used for the business in exchange for common stock, $30,600.
	2	Paid rent on office and equipment for the month, $2,750.
	3	Purchased supplies on account, $2,350.
	4	Paid creditor on account, $890.
	5	Earned sales commissions, receiving cash, $15,800.
	6	Paid automobile expenses (including rental charge) for month, $1,600, and miscellaneous expenses, $680.
	7	Paid office salaries, $2,000.
	8	Determined that the cost of supplies used was $1,150.
	9	Paid dividends, $2,800.

1.	Journalize entries for transactions Oct. 1 through 9. Refer to the Chart of Accounts for exact wording of account titles.
2.	Post the journal entries to the T accounts, selecting the appropriate date to the left of each amount to identify the transactions. Determine the account balances, after all posting is complete. Accounts containing only a single entry do not need a balance.
3.	Prepare an unadjusted trial balance as of October 31, 20Y6.
4.	Determine the following: a. Amount of total revenue recorded in the ledger. b. Amount of total expenses recorded in the ledger. c. Amount of net income for October.
5.	Determine the increase or decrease in retained earnings for October.

1. Journalize entries for transactions Oct. 1 through 9. Refer to the Chart of Accounts for exact wording of account titles.

2. Post the journal entries to the T accounts, selecting the appropriate date to the left of each amount to identify the transactions. Determine the account balances, after all posting is complete. Accounts containing only a single entry do not need a balance.

Cash
Bal.

Supplies
Bal.

Accounts Payable
		Bal.

Common Stock

Dividends

Sales Commissions

Rent Expense

Office Salaries Expense

Automobile Expense

Supplies Expense

Miscellaneous Expense

3. Prepare an unadjusted trial balance as of October 31, 20Y6.

Affordable Realty

UNADJUSTED TRIAL BALANCE

October 31, 20Y6

	ACCOUNT TITLE	DEBIT	CREDIT
1	Cash
2	Supplies
3	Accounts Payable
4	Common Stock
5	Dividends
6	Sales Commissions
7	Rent Expense
8	Office Salaries Expense
9	Automobile Expense
10	Supplies Expense
11	Miscellaneous Expense
12	Totals

4. Determine the following:

	a. Amount of total revenue recorded in the ledger.
	b. Amount of total expenses recorded in the ledger.
	c. Amount of net income for October.

5. Determine the increase or decrease in retained earnings for October.

Answer 1