Aduke Zhawaki is a talented musician who runs a business teaching music and playing in gigs with a variety of other musicians. Her business is operated as a proprietorship, under the name A to Z Music, which has a December 31 year end. On November 30, 2017, the company's general ledger included the following accounts (all accounts have normal balances):

December transactions were as follows:
Dec. 1 Paid December rent on her studio space, $475.
1 Purchased additional sound equipment for $3,500 from a friend who was going back to school to study accounting. The equipment was probably worth $5,000, but the friend needed the cash for tuition and was anxious to sell it. Paid $1,500 cash and promised to pay the remaining amount by December 5.
3 Borrowed $2,500 cash from her parents and signed a note payable.
4 Paid her friend the remaining amount owing on the December 1 transaction.
4 Collected $1,800 from customers in payment of their accounts.
7 Paid the $310 monthly insurance premium.
8 Paid for $150 of supplies.
10 Paid $2,130 of the accounts payable from November.
15 Gave musical performances at two recitals and earned $825. The customers had paid her in November.
20 Received $3,300 cash from students for music lessons provided in December.
21 Paid her monthly telephone bill of $135.
22 Billed customers $2,250 for providing music at several holiday parties.
24 Withdrew $3,000 for personal use.
29 Received $525 cash advance from a customer for a performance in January.
30 Paid travel expenses of $695 for December in cash.
31 Paid her parents $210. Of this amount, $10 is interest and the remainder is a principal payment on the note payable.
Instructions
(a) Enter the November 30 balances in ledger accounts. Use T accounts.
(b) Journalize the December transactions.
(c) Post the December journal entries to the T accounts. Add new accounts if needed.
(d) Prepare a trial balance at December 31, 2017.
TAKING IT FURTHER
Comment on A to Z Music's cash balance at December 31, 2017. What concerns or suggestions do you have for Aduke to consider in January?

Transcribed Image Text:

A. Zhawaki, capital 19,500 A. Zhawaki, drawings Accounts payable Accounts receivable Cash Equipment Fees earned 31,350 4,235 2,200 2,965 17,500 47,075 Insurance expense Rent expense Supplies Telephone expense Travel expense Unearned revenue $3,410 5,225 1,450 1,485 6,050 825