College Accounting 2nd Edition by David Haddock, John Price,Michael Farina

Exercise 31

Using T accounts to record transactions involving revenues and expenses.
The following occurred during June at Carter's Professional Counseling.
INSTRUCTIONS
Analyze each transaction. Use T accounts to record these transactions and be sure to put the name of the account on the top of each account. Record the effects of the transaction in the T accounts. Use plus and minus signs before the amounts to show the increases and decreases.
TRANSACTIONS
1. Purchased office supplies for $2,000.
2. Delivered monthly statements, collected fee income of $21,000.
3. Paid the current month's office rent of $4,000.
4. Completed professional counseling, billed client for $3,000.
5. Client paid fee of $1,000 for weekly counseling, previously billed.
6. Paid office salary of $3,600.
7. Paid telephone bill of $480.
8. Billed client for $2,000 fee for preparing a counseling memorandum.
9. Purchased office supplies of $1,000 on account.
10. Paid office salary of $3,600.
11. Collected $2,000 from client who was billed.
12. Clients paid a total of $8,100 cash in fees.
Analyze: How much cash did the business spend during the month?