• For the past several years, Kareem Ismail has operated a part-time consulting business from his home. As of October 1, 2010, Kareem decided to move to rented quarters and to operate the business, which was to be known as Iron Mountain Consulting, on a full-time basis. Iron Mountain Consulting entered into the following transactions during October: Oct. 1. The following assets were received from Kareem Ismail: cash, $18,000 accounts receivable, $5,000 supplies, $1,500; and office equipment, $10,750. There were no liabilities received. 1. Paid three months’ rent on a lease rental contract, $4,800. 2. Paid the premiums on property and casualty insurance policies, $2,700. 4. Received cash from clients as an advance payment for services to be provided and recorded it as unearned fees, $3,150. 5. Purchased additional office equipment on account from Office Station Co., $1,250. 6. Received cash from clients on account, $2,000. 10. Paid cash for a newspaper advertisement, $325. 12. Paid Office Station Co. for part of the debt incurred on October 5, $750. 12. Recorded services provided on account for the period October 1–12, $5,750. 14. Paid part-time receptionist for two weeks’ salary, $900. 17. Recorded cash from cash clients for fees earned during the period October 1–17, $9,250. 18. Paid cash for supplies, $600. 20. Recorded services provided on account for the period October 13–20, $4,100. 24. Recorded cash from cash clients for fees earned for the period October 17–24, $4,850. 26. Received cash from clients on account, $3,450. 27. Paid part-time receptionist for two weeks’ salary, $900. 29. Paid telephone bill for October, $250. 31. Paid electricity bill for October, $300. 31. Recorded cash from cash clients for fees earned for the period October 25–31, $3,975. 31. Recorded services provided on account for the remainder of October, $2,500. 31. Kareem withdrew $7,500 for personal use. Instructions 1. Journalize each transaction in a two-column journal, referring to the following chart of accounts in selecting the accounts to be debited and credited. (Do not insert the account numbers in the journal at this time.) 11 Cash 31 Kareem Ismail, Capital 12 Accounts Receivable 32 Kareem Ismail, Drawing 14 Supplies 41 Fees Earned 15 Prepaid Rent 51 Salary Expense 16 Prepaid Insurance 52 Rent Expense 18 Office Equipment 53 Supplies Expense 19 Accumulated Depreciation 54 Depreciation Expense 21 Accounts Payable 55 Insurance Expense 22 Salaries Payable 59 Miscellaneous Expense 23 Unearned Fees