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Juanita Ortega is the owner of a professional guide service called Outback Guide Service. Use a form similar to the one below. Complete these steps for each of the following transactions: 1. Identify the accounts affected. 2. Write the amount of the increase (+) or decrease (-) in the space provided on the form in your working papers. 3. Determine the new balance for each account.

   Assets  =Liabilities+Owner’s EquityTrans.Cash inAccts.HikingRaftingOffice=Accounts+Juanita BankRec.Equip.Equip.Equip. Payable Ortega,         Capital\begin{matrix} \text{ } & \text{ } & \text{ } & \text{Assets} & \text{ } & \text{ } & \text{$=$} & \text{Liabilities} & \text{$+$} & \text{Owner’s Equity}\\ \hline \text{Trans.} & \text{Cash in} & \text{Accts.} & \text{Hiking} & \text{Rafting} & \text{Office} & \text{$=$} & \text{Accounts} & \text{$+$} & \text{Juanita}\\ \text{ } & \text{Bank} & \text{Rec.} & \text{Equip.} & \text{Equip.} & \text{Equip.} & \text{ } & \text{Payable} & \text{ } & \text{Ortega,}\\ \text{ } & \text{ } & \text{ } & \text{ } & \text{ } & \text{ } & \text{ } & \text{ } & \text{ } & \text{Capital}\\ \end{matrix}

DateTransactionsJan. 31. Ms. Ortega, the owner, opened a checking account for the business by depositing $60,000 of her personal funds.62. Paid by check the monthly rent of $3,000.83. Bought hiking equipment for the business by writing a check for $3,000.94. Purchased $24,000 of rafting equipment by writing a check. 115. Purchased office equipment on account for $4,000.156. Received payment for guide services, $2,500.187. Ms. Ortega contributed a desk valued at $450 to the business.218. Withdrew $3,000 cash from the business for personal use.269. Wrote a check to a creditor as partial payment on account, $1,5003010. Took a group on a tour and agreed to accept payment later, $1,200.\begin{array}{rl} \text{Date} & \text{Transactions}\\ \hline \text{Jan. 3} & \text{1. Ms. Ortega, the owner, opened a checking account for the business by depositing $\$60,000$ of her personal funds.}\\ \text{6} & \text{2. Paid by check the monthly rent of $\$3,000$.}\\ \text{8} & \text{3. Bought hiking equipment for the business by writing a check for $\$3,000$.}\\ \text{9} & \text{4. Purchased $\$24,000$ of rafting equipment by writing a check. }\\ \text{11} & \text{5. Purchased office equipment on account for $\$4,000$.}\\ \text{15} & \text{6. Received payment for guide services, $\$2,500$.}\\ \text{18} & \text{7. Ms. Ortega contributed a desk valued at $\$450$ to the business.}\\ \text{21} & \text{8. Withdrew $\$3,000$ cash from the business for personal use.}\\ \text{26} & \text{9. Wrote a check to a creditor as partial payment on account, $\$1,500$. }\\ \text{30} & \text{10. Took a group on a tour and agreed to accept payment later, $\$1,200$.}\\ \end{array}

Juanita Ortega runs Outback Guide Service. The accounts she uses to record and report business transactions are listed below.

General Ledger 101 Cash in Bank205 Accounts Payable—105 Accounts Receivable—Peak Equipment Inc.Mary Johnson207 Accounts Payable—130 Office EquipmentPremier Processors140 Computer Equipment301 Juanita Ortega, Capital145 Hiking Equipment 150 Rafting Equipment \begin{matrix} \text{General Ledger} & \text{ }\\ \hline \text{101 Cash in Bank} & \text{205 Accounts Payable—}\\ \text{105 Accounts Receivable—} & \text{Peak Equipment Inc.}\\ \text{Mary Johnson} & \text{207 Accounts Payable—}\\ \text{130 Office Equipment} & \text{Premier Processors}\\ \text{140 Computer Equipment} & \text{301 Juanita Ortega, Capital}\\ \text{145 Hiking Equipment} & \text{ }\\ \text{150 Rafting Equipment} & \text{ }\\ \end{matrix}

For each transaction: 1. In your working papers, prepare a T account for each account. 2. Analyze and record each of the following business transactions in the appropriate T accounts. Identify each transaction by number. 3. After recording all transactions, compute and record the account balance on the normal balance side of each T account. 4. Add the balances of those accounts with normal debit balances. 5. Add the balances of those accounts with normal credit balances. 6. Compare the two totals. Are they the same?

DateTransactionsMay 21. Juanita Ortega transferred an additional $53,250 from her personal savings account into the business checking account.62. Bought hiking equipment for $550, Check 367.73. Bought rafting equipment on account from Peak Equipment Inc. for $2,675.114. Juanita Ortega transferred her own computer, valued at $850, to the business. 165. Bought a cash register for the office on account from Premier Processors for $1,250.196. Sold the computer on credit for $850 to Mary Johnson.227. Paid $500 on account to Peak Equipment Inc., Check 368.248. Purchased shelves for the office for $650, Check 369.289. Paid $1,250 on account to Premier Processors, Check 370.3110. Bought rafting oars for $175, Check 371.\begin{array}{rl} \text{Date} & \text{Transactions}\\ \hline \text{May 2} & \text{1. Juanita Ortega transferred an additional $\$53,250$ from her personal savings account into the business checking account.}\\ \text{6} & \text{2. Bought hiking equipment for $\$550$, Check 367.}\\ \text{7} & \text{3. Bought rafting equipment on account from Peak Equipment Inc. for $\$2,675$.}\\ \text{11} & \text{4. Juanita Ortega transferred her own computer, valued at $\$850$, to the business. }\\ \text{16} & \text{5. Bought a cash register for the office on account from Premier Processors for $\$1,250$.}\\ \text{19} & \text{6. Sold the computer on credit for $\$850$ to Mary Johnson.}\\ \text{22} & \text{7. Paid $\$500$ on account to Peak Equipment Inc., Check 368.}\\ \text{24} & \text{8. Purchased shelves for the office for $\$650$, Check 369.}\\ \text{28} & \text{9. Paid $\$1,250$ on account to Premier Processors, Check 370.}\\ \text{31} & \text{10. Bought rafting oars for $\$175$, Check 371.}\\ \end{array}

The chart of accounts for Outback Guide Service follows.

General Ledger  101 Cash in Bank301 Juanita Ortega, Capital115 Accts. Rec. - Podaski302 Juanita Ortega, WithdrawalsSystems Inc.401 Guide Service Revenue140 Computer Equipment501 Advertising Expense145 Hiking Equipment 150 Rafting Equipment 205 Accts. Pay. - Peak Equipment Inc. 207 Accts. Pay. - Premier Processors \begin{array}{ll} \mathbf{\text{General Ledger }} & \text{ }\\ \text{101 Cash in Bank} & \text{301 Juanita Ortega, Capital}\\ \text{115 Accts. Rec. - Podaski} & \text{302 Juanita Ortega, Withdrawals}\\ \text{Systems Inc.} & \text{401 Guide Service Revenue}\\ \text{140 Computer Equipment} & \text{501 Advertising Expense}\\ \text{145 Hiking Equipment} & \text{ }\\ \text{150 Rafting Equipment} & \text{ }\\ \text{205 Accts. Pay. - Peak Equipment Inc.} & \text{ }\\ \text{207 Accts. Pay. - Premier Processors} & \text{ }\\ \end{array}

  1. In your working papers, open an account in the general ledger for each account in the chart of accounts. 2. Record the following transactions on page 1 of the general journal. 3. Post each journal entry to the appropriate accounts in the ledger. 4. Prove the ledger by preparing a trial balance.

DateTransactionsMar. 1Invested $20,000 in cash and transferred rafting equipment  valued at $5,000 to the business, Memorandum 35.3Purchased $600 in hiking equipment on account from Peak Equipment Inc., Invoice 101.5Bought a $2,800 computer from Premier Processors and agreed to pay for it within 60 days, Invoice 616.7Deposited $700 cash received from clients, Receipts 310–315.9Paid $400 to the Daily Courier for an ad, Check 652.12Sent a bill for $900 to Podaski Systems Inc. for conducting a group rafting trip for them, Sales Invoice 352.15Juanita Ortega wrote a check for $800 for personal use, Check 653.18Paid Premier Processors $1,400 to apply on account, Check 654.22Received $900 from Podaski Systems Inc. in full payment for the amount owed, Receipt 316.27Bought a $500 television ad with LIVE TV, Check 655.28Paid Peak Equipment Inc. $600 by writing Check 656. \begin{array}{rl} \text{Date} & \text{Transactions}\\ \text{Mar. 1} & \text{Invested \$20,000 in cash and transferred rafting equipment }\\ \text{ } & \text{valued at \$5,000 to the business, Memorandum 35.}\\ \text{3} & \text{Purchased \$600 in hiking equipment on account from Peak}\\ \text{ } & \text{Equipment Inc., Invoice 101.}\\ \text{5} & \text{Bought a \$2,800 computer from Premier Processors and agreed}\\ \text{ } & \text{to pay for it within 60 days, Invoice 616.}\\ \text{7} & \text{Deposited \$700 cash received from clients, Receipts 310–315.}\\ \text{9} & \text{Paid \$400 to the Daily Courier for an ad, Check 652.}\\ \text{12} & \text{Sent a bill for \$900 to Podaski Systems Inc. for conducting a}\\ \text{ } & \text{group rafting trip for them, Sales Invoice 352.}\\ \text{15} & \text{Juanita Ortega wrote a check for \$800 for personal use, Check 653.}\\ \text{18} & \text{Paid Premier Processors \$1,400 to apply on account, Check 654.}\\ \text{22} & \text{Received \$900 from Podaski Systems Inc. in full payment for}\\ \text{ } & \text{the amount owed, Receipt 316.}\\ \text{27} & \text{Bought a \$500 television ad with LIVE TV, Check 655.}\\ \text{28} & \text{Paid Peak Equipment Inc. \$600 by writing Check 656. }\\ \end{array}

Calculate the total change in accounts payable.


Juanita Ortega is the owner of Outback Guide Service. The following accounts are used to record the transactions of her business. $$ \begin{matrix} \text{General Ledger} & \text{ }\\ \hline \text{101 Cash in Bank} & \text{205 Accts. Pay.—Peak Equipment Inc.}\\ \text{105 Accts. Rec.—M. Johnson} & \text{207 Accts. Pay.—Premier Processors}\\ \text{110 Accts. Rec.—Feldman,} & \text{301 Juanita Ortega, Capital}\\ \text{Jones & Ritter} & \text{302 Juanita Ortega, Withdrawals}\\ \text{115 Accts. Rec.—Podaski} & \text{310 Income Summary}\\ \text{Systems Inc.} & \text{401 Guide Service Revenue}\\ \text{130 Office Equipment} & \text{501 Advertising Expense}\\ \text{135 Office Furniture} & \text{505 Maintenance Expense}\\ \text{140 Computer Equipment} & \text{515 Rent Expense}\\ \text{145 Hiking Equipment} & \text{520 Salaries Expense}\\ \text{150 Rafting Equipment} & \text{525 Utilities Expense}\\ \text{201 Accts. Pay.—A-1} & \text{ }\\ \text{Adventure Warehouse}\\ \end{matrix} $$ Record the following transactions on page 1 of the general journal in your working papers. $$ \begin{array}{rl} \text{Date} & \text{Transactions}\\ \hline \text{Jan. 1} & \text{Juanita Ortega contributed the following assets to her business: cash, $\$ 1,500 ;$ hiking equipment, $\$ 2,000 ;$ rafting equipment, $\$ 2,500 ;$ and office furniture, $\$ 500 ;$ Memorandum 21.}\\ \text{2} & \text{Issued Check 515 to Town News for a $\$ 75$ ad.}\\ \text{4} & \text{Purchased $\$ 3,000$ in rafting equipment on account from A-1 Adventure Warehouse, Invoice AW45.}\\ \text{6} & \text{A group from Feldman, Jones & Ritter went on a hiking trip. The group was billed $\$ 4,800$ for guide services, Sales Invoice 300.}\\ \text{10} & \text{Paid $\$ 300$ to Dunn's Painting and Interior Co. for painting the office, Check 516. }\\ \text{13} & \text{Made a $\$ 1,000$ payment to A-1 Adventure Warehouse toward the amount owed, Check 517.}\\ \text{15} & \text{Received a check for $\$ 4,800$ from Feldman, Jones 8 Ritter in payment of their account, Receipt 252.}\\ \text{18} & \text{Juanita Ortega paid herself $\$ 600$ by issuing Check 518.}\\ \text{22} & \text{Billed a client, Mary Johnson, $\$ 1,200$ for completing guide services on a hiking expedition, Sales Invoice 301.}\\ \text{25} & \text{Paid the monthly telephone bill for $\$ 175$ by issuing Check 519.}\\ \text{30} & \text{Purchased a $\$ 3,600$ computer system from Premier Processors. Made a down payment for $\$ 1,800$ and agreed to pay the balance within 30 days, Check 520 and Invoice 749.}\\ \end{array} $$


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