Required information Assume Down, Inc., was organized on May 1 to compete with D

Question

Required information Assume Down, Inc., was organized on May 1 to compete with Despair, Inc.-a company that sells de-motivational posters and office products. Down, Inc., encountered the following events during its first month of operations. a. Received $31,000 cash from the investors who organized Down, Inc b. Borrowed $16,000 cash and signed a note due in two years. C. Ordered equipment costing $13,000 d. Purchased $7,000 in equipment, paying $2,000 in cash and signing a six-month note for the balance. e. Received the equipment ordered in (), paid for half of it, and put the rest on account 2. Prepare journal entries for each transaction. (If no entry is required for a transaction/event, select "N° Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Received $31,000 cash from the investors who organized Down, Inc. Record the transaction. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal

Explanation / Answer

a Cash 31000       Contributed capital 31000 b Cash 16000        Notes payable Long-term 16000 c No journal entry required 0 No journal entry required 0 d Equipment 7000      Cash 2000      Notes payable Short-term 5000 e Equipment 13000      Cash 6500      Accounts Payable 6500

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