Brooks invested $150,000 cash along with $22,000 in office equipment in the comp
ID: 2333959 • Letter: B
Question
Brooks invested $150,000 cash along with $22,000 in office equipment in the company in exchange for common stock. March 1 2 The company prepaid $6,000 cash for six months' rent for an office. (Hint: Debit Prepaid Rent for $6,000.) The company made credit purchases of office equipment for $3,000 and office supplies for $1,200. Payment is due within 10 days. 3 6 The company completed services for a client and immediately received $4,000 cash. The company completed a $7,500 project for a client, who must pay within 30 days. 9 The company paid $4,200 cash to settle the account payable created on March 3. 12 The company paid $5,000 cash for the premium on a 12-month insurance policy. (Hint: Debit Prepaid Insurance for $5,000.) 19 The company received $3,500 cash as partial payment for the work completed on March 9. 22 The company completed work for another client for $3,820 on credit. 25 29 The company paid $5,100 cash in dividends. 30 The company purchased $600 of additional office supplies on credit.Explanation / Answer
Answer 1. Journal Entry Date Particulars Dr. Amt. Cr. Amt. 1-Mar Cash 150,000.00 Office Equipment 22,000.00 Common Stock 172,000.00 (To record the issue of common stock) 2-Mar Prepaid Rent 6,000.00 Cash 6,000.00 (To record the rent paid in advance) 3-Mar Office Equipment 3,000.00 Office Supplies 1,200.00 Accounts Payable 4,200.00 (to record the purchase of office equip. & Supplies) 6-Mar Cash 4,000.00 Services Revenue 4,000.00 (To record the service revenue) 9-Mar Accounts Receivabke 7,500.00 Services Revenue 7,500.00 (To record the service revenue) 12-Mar Accounts Payable 4,200.00 Cash 4,200.00 (To record the cash paid) 19-Mar Prepaid Insurance 5,000.00 Cash 5,000.00 (To record the insurance paid) 22-Mar Cash 3,500.00 Accounts Receivable 3,500.00 (To record the cash received) 25-Mar Accounts Receivabke 3,820.00 Services Revenue 3,820.00 (To record the service revenue) 29-Mar Dividends 5,100.00 Cash 5,100.00 (To record the dividends paid) 30-Mar Office Supplies 600.00 Accounts Payable 600.00 (to record the purchase of Supplies) 31-Mar Utilities Expense 500.00 Cash 500.00 (To record the utilities expenses paid) Answer 2. Cash Accounts Receivable Office Supplies 1-Mar 150,000.00 6,000.00 2-Mar 9-Mar 7,500.00 3,500.00 22-Mar 3-Mar 1,200.00 6-Mar 4,000.00 4,200.00 12-Mar 25-Mar 3,820.00 30-Mar 600.00 22-Mar 3,500.00 5,000.00 19-Mar 5,100.00 29-Mar 500.00 31-Mar End. Bal. 136,700.00 End. Bal. 7,820.00 End. Bal. 1,800.00 Prepaid Insurance Prepaid Rent Office Equipment 19-Mar 5,000.00 2-Mar 6,000.00 1-Mar 22,000.00 3-Mar 3,000.00 End. Bal. 5,000.00 End. Bal. 6,000.00 End. Bal. 25,000.00 Accounts Payable Common Stock Dividends 12-Mar 4,200.00 4,200.00 3-Mar 172,000.00 1-Mar 29-Mar 5,100.00 600.00 30-Mar End. Bal. 600.00 End. Bal. 172,000.00 End. Bal. 5,100.00 Services Revenue Utilities Expense 4,000.00 6-Mar 31-Mar 500.00 7,500.00 9-Mar 3,820.00 25-Mar End. Bal. 15,320.00 End. Bal. 500.00 Answer 3. Trial Balance As on Mar-31 Accounts Title Debits Credits Cash 136,700.00 Accounts Receivable 7,820.00 Office Supplies 1,800.00 Prepaid Insurance 5,000.00 Prepaid Rent 6,000.00 Office Equipment 25,000.00 Accounts Payable 600.00 Common Stock 172,000.00 Dividends 5,100.00 Services Revenue 15,320.00 Utilities Expense 500.00 Total 187,920.00 187,920.00
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