Volvo: 1994 850 Turbo, smoking, rattling., sun devil auto, blown head gasket

Question
I have a 1994 850 Turbo, 156k mi. I just bought it a couple weeks ago, I was told by the previous owner that it needed new motor mounts, and has an oil leak (not sure where it originates from). I took it to Sun Devil Auto, to find out that I didn't need new motor mounts, I needed new front axles. I replaced those as well as a long overdue oil change with a filter, the fuel filter, and the air filter. I am now confused because now it blows white smoke profusely, on acceleration, at stop signs/lights, and while braking for a long period of time. The smoke smells like a combo of gasoline and oil. I want to know if my car would be smoking because of the oil leak, or if there is something else I should be considering as the cause of the problem.
I also, just last week, found out that my transmission will need to be rebuilt because my transmission fluid is burnt, shifts hard, doesn't shift at the right RPMs at the higher gears, and makes noises when shifting from P to R. The diagnostic threw a transmission code about internal components being damaged. Could this be a cause of my smoking?

Thank you.

Answer
Laniece,
When an engine blows white smoke it usually means that it is burning coolant. That would indicate a blown head gasket or crack in the cylinder head or block. You might soon experience overheating because if it is burning coolant it may also be pushing compression into the cooling system. The trans problem is a seperate fault and has nothing to do with the engine smoking. On the outside chance that the smoke is oil burning that would indicate worn piston rings or valve guides and seals. Have your shop look into the smoking, they can do some testing for you.