logistic_guy
Full Member
- Joined
- Apr 17, 2024
- Messages
- 674
Maquoketa Services was formed on \(\displaystyle \text{May} \ 1, 2017\). The following transactions took place during the first month.
Transactions on \(\displaystyle \text{May} \ 1\):
\(\displaystyle \bold{1.}\) Jay Bradford invested \(\displaystyle \$ 40,000\) cash in the company, as its sole owner.
\(\displaystyle \bold{2.}\) Hired two employees to work in the warehouse. They will each be paid a salary of \(\displaystyle \$ 3,050\) per month.
\(\displaystyle \bold{3.}\) Signed a \(\displaystyle 2\)-year rental agreement on a warehouse; paid \(\displaystyle \$ 24,000\) cash in advance for the first year.
\(\displaystyle \bold{4.}\) Purchased furniture and equipment costing \(\displaystyle \$ 30,000\). A cash payment of \(\displaystyle \$ 10,000\) was made immediately; the remainder will be paid in \(\displaystyle 6\) months.
\(\displaystyle \bold{5.}\) Paid \(\displaystyle \$ 1,800\) cash for a one-year insurance policy on the furniture and equipment.
Transactions during the remainder of the month:
\(\displaystyle \bold{6.}\) Purchased basic office supplies for \(\displaystyle \$ 420\) cash.
\(\displaystyle \bold{7.}\) Purchased more office supplies for \(\displaystyle \$ 1,500\) on account.
\(\displaystyle \bold{8.}\) Total revenues earned were \(\displaystyle \$ 20,000—\$ 8,000\) cash and \(\displaystyle \$ 12,000\) on account.
\(\displaystyle \bold{9.}\) Paid \(\displaystyle \$ 400\) to suppliers for accounts payable due.
\(\displaystyle \bold{10.}\) Received \(\displaystyle \$ 3,000\) from customers in payment of accounts receivable.
\(\displaystyle \bold{11.}\) Received utility bills in the amount of \(\displaystyle \$ 380\), to be paid next month.
\(\displaystyle \bold{12.}\) Paid the monthly salaries of the two employees, totaling \(\displaystyle \$ 6,100\).
Instructions
\(\displaystyle \bold{(a)}\) Prepare journal entries to record each of the events listed. (Omit explanations.)
\(\displaystyle \bold{(b)}\) Post the journal entries to \(\displaystyle \text{T}\)-accounts.
\(\displaystyle \bold{(c)}\) Prepare a trial balance as of \(\displaystyle \text{May} \ 31, 2017\).
Transactions on \(\displaystyle \text{May} \ 1\):
\(\displaystyle \bold{1.}\) Jay Bradford invested \(\displaystyle \$ 40,000\) cash in the company, as its sole owner.
\(\displaystyle \bold{2.}\) Hired two employees to work in the warehouse. They will each be paid a salary of \(\displaystyle \$ 3,050\) per month.
\(\displaystyle \bold{3.}\) Signed a \(\displaystyle 2\)-year rental agreement on a warehouse; paid \(\displaystyle \$ 24,000\) cash in advance for the first year.
\(\displaystyle \bold{4.}\) Purchased furniture and equipment costing \(\displaystyle \$ 30,000\). A cash payment of \(\displaystyle \$ 10,000\) was made immediately; the remainder will be paid in \(\displaystyle 6\) months.
\(\displaystyle \bold{5.}\) Paid \(\displaystyle \$ 1,800\) cash for a one-year insurance policy on the furniture and equipment.
Transactions during the remainder of the month:
\(\displaystyle \bold{6.}\) Purchased basic office supplies for \(\displaystyle \$ 420\) cash.
\(\displaystyle \bold{7.}\) Purchased more office supplies for \(\displaystyle \$ 1,500\) on account.
\(\displaystyle \bold{8.}\) Total revenues earned were \(\displaystyle \$ 20,000—\$ 8,000\) cash and \(\displaystyle \$ 12,000\) on account.
\(\displaystyle \bold{9.}\) Paid \(\displaystyle \$ 400\) to suppliers for accounts payable due.
\(\displaystyle \bold{10.}\) Received \(\displaystyle \$ 3,000\) from customers in payment of accounts receivable.
\(\displaystyle \bold{11.}\) Received utility bills in the amount of \(\displaystyle \$ 380\), to be paid next month.
\(\displaystyle \bold{12.}\) Paid the monthly salaries of the two employees, totaling \(\displaystyle \$ 6,100\).
Instructions
\(\displaystyle \bold{(a)}\) Prepare journal entries to record each of the events listed. (Omit explanations.)
\(\displaystyle \bold{(b)}\) Post the journal entries to \(\displaystyle \text{T}\)-accounts.
\(\displaystyle \bold{(c)}\) Prepare a trial balance as of \(\displaystyle \text{May} \ 31, 2017\).
