Chapter 2

Analyzing Transactions

83

b. Assuming that there have been no recording errors, will the balance sheet prepared
at December 31 balance? Explain.
EX 2-11
Cash
account
balance

objs. 1, 2, 3
EX 2-12
Account
balances

objs. 1, 2, 3
c.
$284,175

EX 213

Transact
ions

obj. 2

During the month, Racoon Co. received $319,750 in cash and paid out $269,900 in cash.
a. Do the data indicate that Racoon Co. earned $49,850 during the month? Explain.
b. If the balance of the cash account is $72,350 at the end of the month, what was the
cash balance at the beginning of the month?

a. During July, $90,300 was paid to creditors on account, and purchases on account
were $115,150. Assuming the July 31 balance of Accounts Payable was $39,000, determine the account balance on July 1.
b. On May 1, the accounts receivable account balance was $36,200. During May,
$315,000 was collected from customers on account. Assuming the May 31 balance
was $41,600, determine the fees billed to customers on account during May.
c. On April 1, the cash account balance was $18,275. During April, cash receipts totaled $279,100 and the April 30 balance was $13,200. Determine the cash payments
made during April.
Derby Co. has the following accounts in its ledger: Cash; Accounts Receivable;
Supplies; Office Equipment; Accounts Payable; Terri Burell, Capital; Terri Burell,
Drawing; Fees Earned; Rent Expense; Advertising Expense; Utilities Expense;
Miscellaneous Expense.
Journalize the following selected transactions for March 2009 in a two-column journal. Journal entry explanations may be omitted.
Mar. 1.
2.
5.
6.
10.
15.
27.
30.
31.
31.
31.

EX 2-14

Journalizin
g and
posting

objs. 2, 3

EX 2-15

Transaction
s and
T accounts

Paid rent for the month, $3,000.

Paid advertising expense, $1, 800.
Paid cash for supplies, $900.
Purchased office equipment on account, $12,300.
Received cash from customers on account, $4,100.
Paid creditor on account, $1,200.
Paid cash for repairs to office equipment, $500.
Paid telephone bill for the month, $180.
Fees earned and billed to customers for the month, $26,800.
Paid electricity bill for the month, $315.
Withdrew cash for personal use, $ 2,000.

On August 7, 2010, Mainsail Co. purchased $2,190 of supplies on account. In Mainsail

Co.s chart of accounts, the supplies account is No. 15, and the accounts payable account is No. 21.
a. Journalize the August 7, 2010, transaction on page 19 of Mainsail Co.s two-column
journal. Include an explanation of the entry.
b. Prepare a four-column account for Supplies. Enter a debit balance of $1,050 as of
August 1, 2010. Place a check mark () in the Posting Reference column.
c. Prepare a four-column account for Accounts Payable. Enter a credit balance of
$15,600 as of August 1, 2010. Place a check mark () in the Posting Reference column.
d. Post the August 7, 2010, transaction to the accounts.

objs. 2, 3

The following
selected
transactions
were
completed
during
February of
the current
year:
1. Billed
customers for
fees earned,
$41,730.
2. Purchased
supplies on
account, $1,800.
3. Received
cash from
customers on
account,
$39,150.
4. Paid
creditors on
account, $1,100.