Question

Listed below are the transactions of Leon Kawabata, D.D.S., for the month of September.

Sept. 1		Kawabata begins practice as a dentist and invests $21,130 cash.
2		Purchases dental equipment on account from Green Jacket Co. for $17,520.
4		Pays rent for office space, $770 for the month.
4		Employs a receptionist, Michael Bradley.
5		Purchases dental supplies for cash, $1,015.
8		Receives cash of $1,720 from patients for services performed.
10		Pays miscellaneous office expenses, $530.
14		Bills patients $7,190 for services performed.
18		Pays Green Jacket Co. on account, $4,200.
19		Withdraws $3,550 cash from the business for personal use.
20		Receives $1,060 from patients on account.
25		Bills patients $4,090 for services performed.
30		Pays the following expenses in cash: Salaries and wages $2,270; miscellaneous office expenses $89. (Record each separately.)
30		Dental supplies used during September, $400.

Record depreciation using a 5-year life on the equipment, the straight-line method, and no salvage value.

a) Enter the transactions shown above in appropriate general ledger accounts (use T-accounts). Do not use a drawing account. (Post entries in the order displayed in the problem statement.)
b)Prepare a trial balance.

c)Prepare an income statement. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

d)Prepare a statement of owner’s equity. (List items that increase owner's equity first.)
e)Prepare an unclassified balance sheet and Prepare a post-closing trial balance

f)Close the ledger

Answer 1

Answer:-

1.) Journal Entries:-

S.no. Particulars Amount (Dr.) Amount (Cr.)

1.) Purchase Dental Equipment A/c Dr. 17520

To Green JAcket co. 17520

( Being Equipment purchase for credit)

2.) Rent payable A/c Dr. 770

To Bank 770

( Being rent paid for the month of september)

3.) Purchase Dental supplies A/c Dr. 1015   

To Bank 1015

( Being material purchase for dental treatment)

4.) Cash A/c Dr. 1720

To Patients 1720

( Being cash received from patients for providing service)

5.) Expenses A/c Dr. 530

To Bank 530

( Being expenses for clinic has been paid)

6.) Green Jacket Co. A/c Dr. 4200

To Bank 4200

( Being cash paid for equipment purchase on credit)

7.) Drawing A/c Dr. 3550

To Bank 3550

( Being cash withdrawal for personal purpose)

8.) Bank A/c Dr. 1060

To patients account 1060

( Being payment received form patients)

9.) Salaries & Wages A/c Dr. 2270

TO Cash 2270

( Being amount paid for salary & wages)

10.) Miscellaenous Account Dr. 89

To Cash 89

( Being amount paid in cash for expenses)

3. Income Statement:-

Particulars Amount

Revenues:-

Supplies ( 1720 + 7190 ) = 8910

Expenses:-

Rent = (770)

Office Expenses = (530)

Salary = (2270)

Miscellaneous = (89)

Dental supplies purchased = (1015)

Profit / (Loss) = 4236

4.) Owners Equity:-

Cash Introduced = 21130

Add:- Receive Cash form patients ( 1060 + 1720) = 2780

Less:- Drawings = 3550

Less:- PAyment for machine = 4200

Owners Equity = 16160