Set up the following T-accounts: Cash, Accounts Receivable, Office Supplies, Office Furniture, Accounts Payable, Common Stock, Dividends,

Question:

Set up the following T-accounts: Cash, Accounts Receivable, Office Supplies, Office Furniture, Accounts Payable, Common Stock, Dividends, Service Revenue, Salary Expense, and Rent Expense. Record the following transactions directly in the T-accounts without using a journal. Use the letters to identify the transactions. Determine the ending balance in each account.

a. Brian Durham opened a law firm by investing $25,500 cash and office furniture with a fair value of $9,400. Organized as a professional corporation, the business issued common stock to Durham.

b. Paid monthly rent of $1,500.

c. Purchased office supplies on account, $700.

d. Paid employees’ salaries of $2,900.

e. Paid $250 of the account payable created in transaction c.

f. Performed legal service on account, $11,000.
g. Declared and paid dividends of $2,000.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...

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