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Ken Jones, an architect, organized Jones Architects on April 1, 2018. During the month, Jones Architects completed the following transactions:

A. Transferred cash from a personal bank account to an account to be used for the business in exchange for common stock, $18,000. B. Purchased used automobile for$19,500, paying $2,500 cash and giving a note payable for the remainder. C. Paid April rent for office and workroom,$3,150. D. Paid cash for supplies, $1,450. E. Purchased office and computer equipment on account,$6,500. F. Paid cash for annual insurance policies on automobile and equipment, $2,400. G. Received cash from a client for plans delivered,$12,000. H. Paid cash to creditors on account, $1,800. I. Paid cash for miscellaneous expenses,$375. J. Received invoice for blueprint service, due in May, $2,500. K. Recorded fees earned on plans delivered, payment to be received in May,$15,650. L. Paid salary of assistant, $2,800. M. Paid cash for miscellaneous expenses,$200. N. Paid installment due on note payable, $300. O. Paid gas, oil, and repairs on automobile for April,$550.


  1. Record these transactions directly in the following T accounts, without journalizing: Cash, Accounts Receivable, Supplies, Prepaid Insurance, Automobiles, Equipment, Notes Payable, Accounts Payable, Common Stock, Professional Fees, Rent Expense, Salary Expense, Blueprint Expense, Automobile Expense, Miscellaneous Expense. To the left of each amount entered in the accounts, place the appropriate letter to identify the transaction.
  2. Determine account balances of the T accounts. Accounts containing a single entry only (such as Prepaid Insurance) do not need a balance.
  3. Prepare an unadjusted trial balance for Jones Architects as of April 30, 2018.
  4. Determine the net income or net loss for April.

The unadjusted trial balance and adjustment data of Mark's Motors at December 31, 2016, follow:

FARMER INVESTMENT ADVISERSUnadjusted Trial BalanceDecember 31, 2016\begin{array}{c} \textbf{FARMER INVESTMENT ADVISERS}\\ \text{Unadjusted Trial Balance}\\ \text{December 31, 2016}\\ \end{array}

BalanceAccount TitleDebitCreditCash$4,800Accounts Receivable26,600Office Supplies600Prepaid Insurance2,400Equipment53,900Accumulated Depreciation - Equipment$41,500Accounts Payable13,500Wages PayableUnearned Revenue5,500Common Stock18,900Dividends4,200Service Revenue16,300Depreciation Expense - EquipmentWages Expense1,500Insurance ExpenseUtilities Expense1,700Supplies ExpenseTotal$95,700$95,700\begin{array}{lrr} &\textbf{Balance}\\ \textbf{Account Title}&\textbf{Debit}&\textbf{Credit}\\ \text{Cash}&\$4,800\\ \text{Accounts Receivable}&26,600\\ \text{Office Supplies}&600\\ \text{Prepaid Insurance}&2,400\\ \text{Equipment}&53,900\\ \text{Accumulated Depreciation - Equipment}&&\$41,500\\ \text{Accounts Payable}&&13,500\\ \text{Wages Payable}&&\\ \text{Unearned Revenue}&&5,500\\ \text{Common Stock}&&18,900\\ \text{Dividends}&4,200\\ \text{Service Revenue}&&16,300\\ \text{Depreciation Expense - Equipment}\\ \text{Wages Expense}&1,500\\ \text{Insurance Expense}&\\ \text{Utilities Expense}&1,700\\ \text{Supplies Expense}&\\ \text{Total}&\underline{\underline{\$95,700}}&\underline{\underline{\$95,700}}\\ \end{array}

Adjustment data at December 31, 2016: a. Depreciation on equipment, $1,600. b. Accrued Wages Expense,$1,000. c. Office Supplies on hand, $100. d. Prepaid Insurance expired during December,$200. e. Unearned Revenue earned during December, $4,400. f. Accrued Service Revenue,$800.

2017 transactions: a. On January 4, Mark's Motors paid wages of $1,200. Of this,$1,000 related to the accrued wages recorded on December 31. b. On January 10, Mark's Motors received $1,500 for Service Revenue. Of this,$800 related to the accrued Service Revenue recorded on December 31.


  1. Journalize adjusting entries.
  2. Journalize reversing entries for the appropriate adjusting entries.
  3. Refer to the 2017 data. Journalize the cash payment and the cash receipt that occurred in 2017.


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In this exercise, we are asked to prepare adjusting entries and reversing entries.

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