The chart of accounts of Clara s Design Service of

Montreal #4198
The chart of accounts of Clara’s Design Service of Montreal includes the following: Cash, 111;
Accounts Receivable, 112; Office Equipment, 121; Design Equipment, 122; Accounts Payable,
211; Clara Benson, Capital, 311; Clara Benson, Withdrawals, 312; Design Fees Earned, 411;
Advertising Expense, 511; Repair Expense, 512; Salaries Expense, 513; and Telephone
Expense, 514. The following transactions occurred for Clara’s Design Service during the month
of March 2014:A. Clara invested $33,000 in the business from her personal savings account.B.
Bought design equipment on account, $14,000.C. Advertising bill was received but not yet paid,
$1,150.D. Bought office equipment for cash, $3,300.E. Received cash for design services
rendered, $5,900.F. Paid salaries expense, $1,720.G. Paid repair expense for design
equipment, $320. H. Billed customers for design services rendered, $4,300. I. Paid telephone
bill, $150.J. Received $2,000 as partial payment of transaction H. K. Clara paid home telephone
bill from company bank account, $66.L. Paid $700 on the bill received in transaction C.As
Clara’s newly employed accountant, your task is to:1. Setup T accounts in a ledger.2. Record
transactions in the T accounts. (Place the letter of the transaction next to the entry.)3. Foot the
T accounts where appropriate.4. Prepare a trial balance for the end of March 2014.5. Prepare
from the trial balance, in proper form.a. An income statement for the month of March.b. A
statement of owner’s equity for the month ended March 31.c. A balance sheet as of March 31,
2014.View Solution:
The chart of accounts of Clara s Design Service of Montreal

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