Response to the following questions:
1. During the month, Wembley Co. received $212,500 in cash and paid out $183,750 in cash.
a. Do the data indicate that Wembley Co. earned $28,750 during the month? Explain.
b. If the balance of the cash account is $36,300 at the end of the month, what was the cash balance at the beginning of the month?
2. On October 27, 2006, Lintel Co. purchased $1,320 of supplies on account.
a. Journalize the October 27, 2006, transaction.
b. Prepare a T account for Supplies. Enter a debit balance of $585 as of October 1, 2006.
c. Prepare a T account for Accounts Payable. Enter a credit balance of $6,150 as of October 1, 2006.
d. Post the October 27, 2006, transaction to the accounts and determine account balances.