On November 1, 20Y9, Lexi Martin established an interior decorating business, Heritage Designs. During the month, Lexi completed the following transactions related to the business:

Nov.1Lexi transferred cash from a personal bank account to an account to be used for the business in exchange for common stock, $27,200.

1 Paid rent for period of November 1 to end of month, $4,000.

6Purchased office equipment on account, $12,820.

8Purchased a truck for $30,800 paying $6,900 cash and giving a note payable for the remainder.

10Purchased supplies for cash, $1,650.12Received cash for job completed, $8,000.

15Paid annual premiums on property and casualty insurance, $2,300.

23Recorded jobs completed on account and sent invoices to customers, $12,000.

24Received an invoice for truck expenses, to be paid in November, $1,190.

Enter the following transactions on Page 2 of the two-column journal:

Nov.29 Paid utilities expense, $3,560.

29. Paid miscellaneous expenses, $1,800.

30. Received cash from customers on account, $7,500.

30. Paid wages of employees, $4,750.

30. Paid creditor a portion of the amount owed for equipment purchased on November 6, $6,230.

30. Paid dividends, $2,000.

1.Journalizeeach transaction in a two-columnjournalbeginning on Page 1, referring to thechart of accountsin selecting theaccountsto bedebitedandcredited. (Do not insert the post reference numbers until you have posted the entry to the general ledger in part 2.) Refer to the Chart of Accounts for exact wording of account titles.

2.Post(in chronological order) the journal to aledgerof four-column accounts, inserting appropriate posting references in both the journal and the ledger as each item is posted. Extend the balances to the appropriate balance columns after each transaction is posted.

3.Prepar anunadjusted trial balancefor Heritage Designs as of November 30, 20Y9.

4.Determine the excess ofrevenuesoverexpensesfor November.

5.Can you think of any reason why the amount determined in (4) might not be the net income for November?

CHART OF ACCOUNTSHeritage DesignsGeneral Ledger

ASSETS

11Cash

12Accounts Receivable

13Supplies

14Prepaid Insurance

16Equipment

18Truck

LIABILITIES

21Notes Payable

22Accounts Payable

EQUITY

31Common Stock

32Retained Earnings

33Dividends

REVENUE

41Fees Earned

EXPENSES

51Wages Expense

53Rent Expense

54Utilities Expense

55Truck Expense

59Miscellaneous Expense