Preparation of T-account entries and adjusted trial balance. Jennifer Langer and Gloria Langer organize a corporation known as the Sisters" Collection Agency on January 1, Year 3. The firm collects overdue accounts receivable of various clients on a commission basis. The following transactions occur during January:

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Jennifer Langer contributes office supplies of $2,000 and cash of $8,000. She receives stock certificates for 500 shares with a par value of $20 a share.

(2) Gloria Langer contributes cash of $4,000 and office equipment valued at $6,000.

She receives stock certificates for 500 shares.

(3) The Langer agency collects $1,200 on an account turned over to it by Z-Mart Stores. It earns a commission of 50 percent of the amount collected.

(4) The firm pays salaries of $1,500 during January.

(5) The firm receives a bill from Lyband and Linn, certified public accountants, for

$800 to cover the cost of installing a computer system.

(6) The firm pays the amount due Z-Mart Stores (see transaction (3) above).

(7) The firm leases an office for the year, beginning February 1, Year 3, and pays the rent for two months in advance. It writes a check for $1,000.

(8) The firm purchases an automobile on January 31 for $15,000; it pays $2,500 by check and signs an installment contract, payable to the Scotch Automobile Sales Company, for the balance.

a. Open T-accounts and record the transactions during January.

b. Prepare an adjusted, preclosing trial balance as of January 31, Year 3. Indicate, by the letters R or E, which accounts are revenue and which are expense accounts.