R. C. Pryor established Pryor’s Secretarial Service during Octo¬

ber of this year. The accountant prepared the following chart of accounts:

The following transactions occurred during the month:

a. Pryor invested $12,900 cash to establish the business.

b. Paid rent for the month, $545.

c. Bought office desks and filing cabinets for cash, $1,262.

d. Bought a computer and printer (Office Equipment) for use in the business from Pollard Computer Center for $12,400; paid $2,500 down, with the bal¬
ance due in thirty days.

e. Bought a neon sign for $625; paid $300 down, with the balance due in thirty days.

f. Pryor invested in the business her personal computer software with a fair market value of $1,410.

g. Received bill for advertising from City News and Views, $89.
h. Received cash for services rendered, $614.
i. Received and paid electric bill, $147.
j. Paid bill for advertising, recorded previously in transaction (g).
k. Received cash for services rendered, $1,092.
l. Paid wages to employees, $610.
m. Received and paid for city business license, $32.
n. Pryor withdrew cash for personal use, $450.
o. Bought printout paper and stationery from Lowery, Inc., with payment due in thirty days, $114.
Instructions 1. Record the owner’s name in the Capital and Drawing T accounts.
2. Record the plus and minus signs for each T account, and label the debit and credit sides of the T accounts.
3. Record the transactions in the T accounts. Key each entry to the alphabetical symbol identifying the transaction.
4. Foot the T accounts and show balances.
5. Prepare a trial balance with a three-line heading, dated October 31.

Transcribed Image Text:

Assets Cash Supplies Computer Software Office Equipment Neon Sign Liabilities Accounts Payable Owner's Equity R. C. Pryor, Capital R. C. Pryor, Drawing Revenue Income from Services Expenses Rent Expense Utilities Expense Wages Expense Advertising Expense Miscellaneous Expense