Required information The following information applies to the questions displaye

Question

Required information The following information applies to the questions displayed below Vanishing Games Corporation (vGc) operates a massively multiplayer online game, charging players a monthly subscription of $12. sheet account balances were as follows At the start of January 2018. VGC's Income statement accounts had zero balances and its balance Cash Accounts Receivable Supplies Equipment Buiidings Land Accounts Payable Deferred Revenue Notes Payable (due 2025) Common Stock S1,680,000 182/000 20,500 906/000 462,000 1-690,000 167,000 97,000 111000 2,200,000 2365,500 In addition to the above accounts, VGCs chart of accounts includes the following:Service Revenue, Salaries and Wages Expense, Advertising Expe nse, and Utilities Expense. The following transactions occurred during the January month 250 cash from customers on 1/1 for subscriptions that had already been earned in 2017 a. Received $55, b. Purchased 10 new computer servers for $39.600 on 1/2; paid $11,000 cash and signed a three-year note for the remainder owed. c Pald $18,700 for an Internet advertisement run on 1/3 d. On January 4, purchased and received $5,000 of supplies on account. e. Received $185,000 cash on 1/5 from customers for servic f Paid $5,000 cash to a supplier on January 6 e revenue earned in January g. On January 7 sold 13.200 subscriptions at $12 each for services provided during January. Half was collected In cash and half was sold on account h. Paid $315.000 in waces to emplovees on 1/30 for work done in Januarv

Explanation / Answer

Journal entry :

No account and explanation debit credit a Cash 55250 Account receivable 55250 (To record amount received) b Computer server 39600 Cash 11000 Notes payable 28600 (To record purchase computer server) c Advertisement expense 18700 Cash 18700 (To record advertisement expense) d Supplies 5000 Account payable 5000 (To record purchased supplies) e Cash 185000 Service revenue 185000 (To record service revenue) f Account payable 5000 Cash 5000 (To record amount paid) g Cash 79200 Account receivable 79200 Service revenue (13200*12) 158400 (To record service revenue) h Utilities expense 5980 Utilities payable 5980 (To record utilities expense)

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