Setting up T accounts:
Williams cleaning service has the following account balances on December 31, 2013. Set up T account for each account and enter account and enter balance on the proper side of the accounts
• Cash $18,000
• Equipment $45,000
• Account payable $23,200
• Wade Williams Capital $ 39,800
Using T account to analyze transactions:
1. Donna invested $80,000 cash in the business.
2. Paid $20,000 in cash for equipment.
3. Performed services for cash amount to 8,000.
4. Paid 2,800 in cash for advertising expense.
5. Paid 2,000 in cash for suppliers.
Donna Wells decide to start a dental practice. The first five transactions for the business follow. For each transaction, (1) determine which two accounts are affected, (2) set up T accounts for the affected accounts, and (3) enter the debit and credit amounts in the T accounts.
Determining debit and credit balances. Indicates whether each of the following accounts normally has debit balance or credit balance:
1. Ted Wilson, Capital
3. Fee Income
4. Account Payable