Question

Excercise 3-11 and 3-13
Problem 3-12

Atkins Advertising Agency began busll during its first month of operations are as a. Acquired its articles of in a. Acquired is arickes of incorporation from the state and issued 100,000 sh 3 56Probleri 3 shares of capital in exchange for $200,000 in cash. b. an office building for $150,000 in cash. The building is valued at S e at the bank for $125,000. Purchased reeing to pay the remainde c. Signed a three-year promissory not r of the value is assigned to the land. the remainder in ten days. e. Paid wages and salaries of $13,000 for the fist half of the month. Otice employees are d. Purchaved office equipment at a cost of $50,000, paying $10,000 down and agrecin wice a month. f Paid the balance due on the office equipment. g Sold $24,000 of advertising during the first month. Customers have until the 15th of following month to pay their bills. h. Paid wages and salaries of $15,000 for the second half of the month. Recorded $3,500 in commissions earned by the salespeople during the month. They will be i. paid on the fifth of the following month. Required Prepare in journal form the entry to record each transaction 4.5 Problem 3-12 Journal Entries Recorded Directly in T Accounts (Appendix) Refer to the transactions for Atkins Advertising Agency in Problem 3-11. XRequired I. Record each transaction directly in T accounts using the letters preceding the transactions to identify them in the accounts. Each account involved in the problem needs a separate T account 2. Prepare a trial balance at January 31. Problem 3-13 The Detection of Errors in a Trial Balance and Preparation of a Corrected Trial Balance (Appendix) 5.7 $90,000 of cash contributed by the owners. The only other transaction entered into prior to be ginning equipment. The following trial balance was prepared at the end of the first month by the book- keeper for Malcolm Inc. Inc, was incorporated on January 1 with the issuance of capital stock in return for operations was the issuance of a $75,300 note payable in exchange for building and Malcolm Inc. Trial Balance January 31 Account Titles Cash Accounts Receivable Land Building Equipment Notes Payable Capital Stock Service Revenue Debits $ 9,980 8,640 80,000 50,000 23,500 Credits

Answer 1

Excercise 3-11

Capital Stock
	$1000 (1)
Cash
(1) $1,000
(2) 1,400
(4) 250
Service Revenue
(3) $450	$1400 (2)
Accounts Payable
(4) $250	$450 (3)
(8) 1,350	600 (5)
	1,350 (6)
	250 (7)
Equipment
(6) $1,350	$1,350 (8)
Supplies
(5) $600
Utilities Expense
	$250 (7)

Trial Balance

	Debit	Credit
Cash	2,650
Equipment	0
Supplies	600
Aaccounts Payable		1050
Capital Stock		1000
Service Revenue		950
Utilities Expense		250
	3250	3250

　

Excercise 3-12

Solution: $1,000

Working: $7500 - 6000 = 1500

2500 - 1500 = 1000