Question

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

Sept. 1		Kawabata begins practice as a dentist and invests $24,450 cash.
2		Purchases dental equipment on account from Green Jacket Co. for $18,900.
4		Pays rent for office space, $770 for the month.
4		Employs a receptionist, Michael Bradley.
5		Purchases dental supplies for cash, $1,035.
8		Receives cash of $1,760 from patients for services performed.
10		Pays miscellaneous office expenses, $520.
14		Bills patients $7,640 for services performed.
18		Pays Green Jacket Co. on account, $5,260.
19		Withdraws $3,480 cash from the business for personal use.
20		Receives $1,010 from patients on account.
25		Bills patients $3,300 for services performed.
30		Pays the following expenses in cash: Salaries and wages $3,500; miscellaneous office expenses $92. (Record each separately.)
30		Dental supplies used during September, $370.

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

Enter the transactions shown above in appropriate general ledger accounts (use T-accounts). Do not use a drawing account. statement.) Cash T Sept. 1 T 24450 Sept. 4 770 T Sept. 8 T Sept. 5 1035 T Sept. 20 T Sept. 10 520 | Sept. 18 5260 Sept. 19 3480 Sept. 30 3500 Sept. 30 Sept. 30 Bal. 9 i 12563 |

Answer 1

Cash
Sept.	1		24450	Sept.	4		770
Sept.	8		1760	Sept.	5		1035
Sept.	20		1010	Sept.	10		520
				Sept.	18		5260
				Sept.	19		3480
				Sept.	30		3500
				Sept.	30		92
Sept.	30	Bal	12563

Owner’s Capital
Sept.	19		3480	Sept.	1		24450
				Sept.	30		7133
				Bal.	30		28103

Accounts Payable
Sept.	18		5260	Sept.	2		18900
				Bal.	30		13,640

Rent Expense
Sept.	4		770	Sept.	30		770

Supplies
Sept.	5		1035	Sept.	30		370
Bal.	30		665

Service Revenue
Sept.	30		12700	Sept.	8		1760
					Sept.	14		7640
					Sept.	25		3300
				12700				12700

Office Expense
Sept.	10		520	Sept.	30		612
	30		92
			612				612

Salaries and Wages Expense
Sept.	30		3500	Sept.	30		3500

Supplies Expense
Sept.	30		370	Sept.	30		370

Income Summary
Sept.	30		770	Sept.	30		12700
Sept.	30		612
Sept.	30		3500
Sept.	30		370
Sept.	30		315
Sept.	30	Inc.	7133
			12700				12700

Depreciation expense = 18900/(12*5) = 315

Part B

ADAM KAWABATA, D.D.S. Trial Balance September 30
	Debit	Credit
Cash	12563
Accounts Receivable	9930
Supplies	665
Equipment	18900
Accumulated Depreciation—Equipment		315
Accounts Payable		13640
Owner’s Capital		20970
Service Revenue		12700
Rent Expense	770
Office Expense	612
Salaries and Wages Expense	3500
Supplies Expense	370
Depreciation Expense	315
Totals	$47625	$47625

Part C

ADAM KAWABATA, D.D.S. Income Statement For the Month of September
Service revenue		12700
Expenses:
Salaries and wages expense	770
Rent expense	612
Supplies expense	3500
Depreciation expense	370
Office expense	315
Total expenses		5567
Net income		$7133

ADAM KAWABATA, D.D.S. Statement of Owners’ Equity For the Month of September
Owner’s Capital September 1	24450
Add:       Net income for September	7133
	31583
Less: Withdrawal by owner	3480
Owner’s Capital September 30	$28103

ADAM KAWABATA, D.D.S. Balance Sheet As of September 30
Assets
Cash		12563
Accounts receivable		9930
Supplies		665
Equipment.	18900
Less: Accumulated Depreciation—Equipment	315	18585
Total assets		$41743
Liabilities and Owners’ Equity
Accounts payable		13640
Owner’s Capital		28103
Total liabilities and owners’ equity		$41743