Question

Learning Objectives 3, 4 P2-31A Journalizing transactions, posting journal entries to four-column accounts, and preparing a trial balance Terrence Murphy opened a law office on January 1, 2018. During the first month of operations, the business completed the following transactions: 3. Cash Balance $50, 160 CHAPTER 2 Jan. 1 Murphy contributed $78,000 cash to the business, Terrence Murphy Attorney. The business gave capital to Murphy. 3 Purchased office supplies, $600, and furniture, $1,700, on account. Performed legal services for a client and received $1,000 cash. Purchased a building with a market value of $130,000, and land with a market value of $25,000. The business paid $25,000 cash and signed a note payable to the bank for the remaining amount. 11 Prepared legal documents for a client on account, $400. 15 Paid assistant's semimonthly salary, $1,120. 16 Paid for the office supplies purchased on January 3 on account. 18 Received $2,700 cash for helping a client sell real estate. 19 Defended a client in court and billed the client for $1,800. 25 Received a bill for utilities, 5600. The bill will be paid next month. 29 Received cash on account, $1,500. 30 Paid $1,200 cash for a 12-month insurance policy starting on February 1. 30 Paid assistant's semimonthly salary, $1,120. 31 Paid monthly rent expense, $1,800. 31 Murphy withdrew cash of $2,200. Requirements 1. Record each transaction in the journal, using the following account titles: Cash; Accounts Receivabl, Office Supplies: Prepaid Insurance Land; Building Furniture, Accounts Payable; Utilities Payable; Notes Payable; Murphy, Capital; Murphy, Withdrawals; Service Revenue; Salaries Expense; Rent Expense; and Utili- ties Expense. Explanations are not required. 2. Open the following four-column accounts including account numbers: Cash, 101; Accounts Receivable, 111, Office Supplies, 121; Prepaid Insurance, 131, Land, 141; Building, 151; Furniture, 161; Accounts Payable, 201; Utilities Payable, 211; Notes Payable, 221; Murphy, Capital, 301; Murphy, Withdrawals, 311; Service Revenue, 411; Salaries Expense, 511; Rent Expense, 521; and Utilities Expense, 531. 3. Post the journal entries to four column accounts in the ledger, using dates, account numbers, journal references, and posting references. Assume the journal entries were recorded on page 1 of the journal. 4. Prepare the trial balance of Terrence Murphy, Attorney, at January 31, 2018.

Answer 1

Answer.

1. Journal Entries
Date	Account Tittle	Debit	Credit
2022
1-Jan	Cash	78000
	Murphy, Capital		78000
3-Jan	Office Supplies	600
	Furniture	1700
	Accounts Payable		2300
4-Jan	Cash	1,000
	Service Revenue		1,000
7-Jan	Land	25000
	Cash		25000
7-Jan	Building	130,000
	Notes Payable		130000
11-Jan	Account Receivable	400
	Service Revenue		400
15-Jan	Salaries Expense	1120
	Cash		1120
16-Jan	Accounts Payable	600
	Cash		600
18-Jan	Cash	2700
	Service Revenue		2,700
19-Jan	Accounts Receivable	1800
	Service Revenue		1800
25-Jan	Utilities Expense	600
	Utilities Payable		600
29-Jan	Cash	1500
	Account Receivable		1500
30-Jan	Prepaid Insurance	1200
	Cash		1200
30-Jan	Salaries Expense	1120
	Cash		1120
31-Jan	Rent Expense	1800
	Cash		1800
31-Jan	Murphy, Withdrawals	2200
	Cash		2200
Note- Explanation were not required.

2 & 3. Opening four column ledger and postings
Cash-101
Date	Account No.	P.R	Debit	Credit	Balance
1-Jan	301	1	78000		78000
4-Jan	411		1000		79000
7-Jan	141			25000	54000
15-Jan	511			1120	52880
16-Jan	201			600	52280
18-Jan	411		2700		54980
29-Jan	111		1500		56480
30-Jan	131			1200	55280
30-Jan	511			1120	54160
31-Jan	521			1800	52360
31-Jan	311			2200	50160
Accounts Receivable-111
11-Jan	411		400		400
19-Jan	411		1800		2200
29-Jan	101			1500	700
Office Supplies-121
3-Jan	201		600		600
	Prepaid Insurance-131
30-Jan	101		1200		1200
Land-141
7-Jan	101		25000		25000
Building-151
7-Jan	221		130000		130000
Furniture-161
3-Jan	201		1700		1700
Accounts Payable-201
3-Jan	121			600	600
3-Jan	161			1700	2300
16-Jan	101		600		1700
Utilities Payable-211
25-Jan	531			600	600
Notes Payable-221
7-Jan	151			130000	130000
Murphy, Capital-301
1-Jan	101			78000	78000
Murphy, Withdrawals-311
31-Jan	101		2200		2200
Service Revenue-411
4-Jan	101			1000	1000
11-Jan	111			400	1400
18-Jan	101			2700	4100
19-Jan	111			1800	5900
Salaries Expense-511
15-Jan	101		1120		1120
30-Jan	101		1120		2240
Rent Expense-521
31-Jan	101		1800		1800
Utilities Expense-531
25-Jan	211		600		600

4. Prepared Trial Balance

Terrence Murphy, Attorney
Trial Balance
For the Month Ended Jan. 31,2018
Accounts Name	Debit	Credit
Cash	50160
Accounts Receivable	700
Office Supplies	600
Prepaid Insurance	1200
Land	25000
Building	130000
Furniture	1700
Accounts Payable		1700
Utilities Payable		600
Notes Payable		130000
Murphy, Capital		78000
Murphy, Withdrawals	2200
Service Revenue		5900
Salaries Expense	2240
Rent Expense	1800
Utilities Expense	600
Total	216200	216200