diff --git a/src/executive.rs b/src/executive.rs
index 2527209c1..9f04293a0 100644
--- a/src/executive.rs
+++ b/src/executive.rs
@@ -55,7 +55,6 @@ pub struct Executed {
 	pub cumulative_gas_used: U256,
 	/// Vector of logs generated by transaction.
 	pub logs: Vec<LogEntry>,
-
 	/// Execution ended running out of gas.
 	pub out_of_gas: bool,
 	/// Addresses of contracts created during execution of transaction.
@@ -102,8 +101,6 @@ impl<'a> Executive<'a> {
 
 	/// This funtion should be used to execute transaction.
 	pub fn transact(&mut self, t: &Transaction) -> Result<Executed, Error> {
-		// TODO: validate transaction signature ?/ sender
-
 		let sender = try!(t.sender());
 		let nonce = self.state.nonce(&sender);
 
@@ -244,9 +241,10 @@ impl<'a> Executive<'a> {
 				self.state.add_balance(&t.sender().unwrap(), &refund_value);
 				
 				// fees earned by author
-				let fees = (t.gas - refund) * t.gas_price;
+				let fees = t.gas - refund;
+				let fees_value = fees * t.gas_price;
 				let author = &self.info.author;
-				self.state.add_balance(author, &fees);
+				self.state.add_balance(author, &fees_value);
 
 				// perform suicides
 				for address in substate.suicides.iter() {
@@ -742,4 +740,132 @@ mod tests {
 		assert_eq!(state.storage_at(&address, &H256::from(&U256::zero())), H256::from(&U256::from(1)));
 		assert_eq!(state.storage_at(&address, &H256::from(&U256::one())), H256::from(&U256::from(1)));
 	}
+
+	#[test]
+	fn test_transact_simple() {
+		let mut t = Transaction::new_create(U256::from(17), "3331600055".from_hex().unwrap(), U256::from(100_000), U256::zero(), U256::zero());
+		let keypair = KeyPair::create().unwrap();
+		t.sign(&keypair.secret());
+		let sender = t.sender().unwrap();
+		let contract = contract_address(&sender, &U256::zero());
+
+		let mut state = State::new_temp();
+		state.add_balance(&sender, &U256::from(18));	
+		let mut info = EnvInfo::new();
+		info.gas_limit = U256::from(100_000);
+		let engine = TestEngine::new(0);
+
+		let executed = {
+			let mut ex = Executive::new(&mut state, &info, &engine);
+			ex.transact(&t).unwrap()
+		};
+
+		assert_eq!(executed.gas, U256::from(100_000));
+		assert_eq!(executed.gas_used, U256::from(20_025));
+		assert_eq!(executed.refunded, U256::from(79_975));
+		assert_eq!(executed.cumulative_gas_used, U256::from(20_025));
+		assert_eq!(executed.logs.len(), 0);
+		assert_eq!(executed.out_of_gas, false);
+		assert_eq!(executed.contracts_created.len(), 0);
+		assert_eq!(state.balance(&sender), U256::from(1));
+		assert_eq!(state.balance(&contract), U256::from(17));
+		assert_eq!(state.nonce(&sender), U256::from(1));
+		assert_eq!(state.storage_at(&contract, &H256::new()), H256::from(&U256::from(1)));
+	}
+
+	#[test]
+	fn test_transact_invalid_sender() {
+		let t = Transaction::new_create(U256::from(17), "3331600055".from_hex().unwrap(), U256::from(100_000), U256::zero(), U256::zero());
+
+		let mut state = State::new_temp();
+		let mut info = EnvInfo::new();
+		info.gas_limit = U256::from(100_000);
+		let engine = TestEngine::new(0);
+
+		let res = {
+			let mut ex = Executive::new(&mut state, &info, &engine);
+			ex.transact(&t)
+		};
+		
+		match res {
+			Err(Error::Util(UtilError::Crypto(CryptoError::InvalidSignature))) => (),
+			_ => assert!(false, "Expected invalid signature error.")
+		}
+	}
+
+	#[test]
+	fn test_transact_invalid_nonce() {
+		let mut t = Transaction::new_create(U256::from(17), "3331600055".from_hex().unwrap(), U256::from(100_000), U256::zero(), U256::one());
+		let keypair = KeyPair::create().unwrap();
+		t.sign(&keypair.secret());
+		let sender = t.sender().unwrap();
+		
+		let mut state = State::new_temp();
+		state.add_balance(&sender, &U256::from(17));	
+		let mut info = EnvInfo::new();
+		info.gas_limit = U256::from(100_000);
+		let engine = TestEngine::new(0);
+
+		let res = {
+			let mut ex = Executive::new(&mut state, &info, &engine);
+			ex.transact(&t)
+		};
+		
+		match res {
+			Err(Error::Execution(ExecutionError::InvalidNonce { expected, is })) 
+				if expected == U256::zero() && is == U256::one() => (), 
+			_ => assert!(false, "Expected invalid nonce error.")
+		}
+	}
+
+	#[test]
+	fn test_transact_gas_limit_reached() {
+		let mut t = Transaction::new_create(U256::from(17), "3331600055".from_hex().unwrap(), U256::from(80_001), U256::zero(), U256::zero());
+		let keypair = KeyPair::create().unwrap();
+		t.sign(&keypair.secret());
+		let sender = t.sender().unwrap();
+
+		let mut state = State::new_temp();
+		state.add_balance(&sender, &U256::from(17));	
+		let mut info = EnvInfo::new();
+		info.gas_used = U256::from(20_000);
+		info.gas_limit = U256::from(100_000);
+		let engine = TestEngine::new(0);
+
+		let res = {
+			let mut ex = Executive::new(&mut state, &info, &engine);
+			ex.transact(&t)
+		};
+
+		match res {
+			Err(Error::Execution(ExecutionError::BlockGasLimitReached { gas_limit, gas_used, gas })) 
+				if gas_limit == U256::from(100_000) && gas_used == U256::from(20_000) && gas == U256::from(80_001) => (), 
+			_ => assert!(false, "Expected block gas limit error.")
+		}
+	}
+
+	#[test]
+	fn test_not_enough_cash() {
+		let mut t = Transaction::new_create(U256::from(18), "3331600055".from_hex().unwrap(), U256::from(100_000), U256::one(), U256::zero());
+		let keypair = KeyPair::create().unwrap();
+		t.sign(&keypair.secret());
+		let sender = t.sender().unwrap();
+
+		let mut state = State::new_temp();
+		state.add_balance(&sender, &U256::from(100_017));	
+		let mut info = EnvInfo::new();
+		info.gas_limit = U256::from(100_000);
+		let engine = TestEngine::new(0);
+
+		let res = {
+			let mut ex = Executive::new(&mut state, &info, &engine);
+			ex.transact(&t)
+		};
+		
+		match res {
+			Err(Error::Execution(ExecutionError::NotEnoughCash { required , is })) 
+				if required == U512::zero() && is == U512::one() => (), 
+			_ => assert!(false, "Expected not enough cash error.")
+		}
+	}
 }