Hiroshi Mori began an upholstery cleaning business on October 1 and engaged in the following transactions during the month:

Oct. 1 Began business by depositing $12,000 in a bank account in the name of the corporation in exchange for 12,000 shares of $1 par value common stock.

2 Ordered cleaning supplies, $1,000.

3 Purchased cleaning equipment for cash, $2,800.

4 Made two months’ van lease payment in advance, $1,200.

7 Received the cleaning supplies ordered on October 2 and agreed to pay half the amount in 10 days and the rest in 30 days.

9 Paid for repairs on the van with cash, $80.

12 Received cash for cleaning upholstery, $960.

Oct. 17 Paid half the amount owed on supplies purchased on October 7, $500.
21 Billed customers for cleaning upholstery, $1,340.
24 Paid cash for additional repairs on the van, $80.
27 Received $600 from the customers billed on October 21.
31 Declared and paid a dividend of $700.
Required 1. Set up the following T accounts: Cash; Accounts Receivable; Cleaning Supplies; Prepaid Lease; Cleaning Equipment; Accounts Payable; Common Stock; Dividends; Cleaning Revenue; and Repair Expense.
2. Record transactions directly in the T accounts. Identify each entry by date.
3. Prepare a trial balance for Mori Upholstery Cleaning, Inc., as of October 31, 20xx.
4. User insight: Compare and contrast how the issues of recognition, valuation, and classification are settled in the transactions of October 7 and 9.
Transaction Analysis, General Journal, Ledger Accounts, and Trial Balance