REQUIREMENT #1: During its first month of operation, the Parkview Landscaping Co
ID: 2379039 • Letter: R
Question
REQUIREMENT #1: During its first month of operation, the Parkview Landscaping Corporation, which specializes in residential landscaping, completed the following transactions: July 1 Began business by making a deposit in a company bank account of $24,000, in exchange for 4,800 shares of $5 par value common stock. July 1 Paid the premium on a one-year insurance policy, $2,400. July 1 Paid the current month's rent, $2,080. July 3 Purchased landscaping equipment from Brookwood Company, $8,800. Paid $1,200 down and the balance was placed on account. Payments will be $400.00 per month for nineteen months. The first payment is due 8/1. Note: Use Accounts Payable for the Balance Due. July 8 Purchased landscaping supplies from Lakeside Company on credit, $780. July 12 Paid utility bill for July, $308. July 16 Received cash for landscaping revenue for the first half of July, $2,724. July 19 Made payment on account to Lakeside Company, $400. July 31 Received cash for landscaping revenue for the last half of July, $2,620. July 31 Declared and paid cash dividend of $1,600. Prepare journal entries to record the July transactions in the General Journal below.
Explanation / Answer
July 1 Began business by making a deposit in a company bank account of $24,000, in exchange
for 4,800 shares of $5 par value common stock.
Debit: Cash 24,000
Credit: Common Stock 24,000
July 1 Paid the premium on a one-year insurance policy, $2,400.
Debit Prepaid Insurance 2,400
Credit Cash 2,400
July 1 Paid the current month's rent, $2,080.
Debit Rent Expense 2,080
Credit Cash 2,080
July 3 Purchased landscaping equipment from Brookwood Company, $8,800. Paid $1,200 down and the balance was
placed on account. Payments will be $400.00 per month for nineteen months. The first payment is due 8/1.
Note: Use Accounts Payable for the Balance Due.
Debit Landscaping Equipment 8,800
Credit Cash 1,200
Credit Accounts Payable 7,600
July 8 Purchased landscaping supplies from Lakeside Company on credit, $780.
Debit Landscaping Supplies 780
Credit Accounts Payable 780
July 12 Paid utility bill for July, $308.
Debit Utility Expense 308
Credit Cash 308
July 16 Cash landscaping revenue for the first half of July, $2,724.
Debit Cash 2,724
Credit Landscaping Revenue 2,724
July 19 Made payment on account to Lakeside Company, $400.
Debit Accounts Payable 400
Credit Cash 400
July 31 Cash landscaping revenue for the last half of July, $2,620.
Debit Cash 2,620
Credit Landscaping Revenue 2,620
July 31 Declared and paid cash dividend of $1,600.
Debit Retained Earnings 1,600
Credit Cash 1,600
Requirement 4 - Prepare the Adjusting Entries Adjusting Entries(Help on this one!)
Dr Insurance Expense $200
Cr Prepaid Insurance $200
Expensed Insurance for July
Dr Acct Payable 400
Cr Cash 400
Supplie Lakeside paid partila paymnt
Dr Acct Payable 1200
Cr Cash 1200
Paid $1200 to Brrokwood
Retained Earnings Dr 2356
Net Income Cr 2356
CLosed out Income acct
Dr Dividend Paid $1600
Cr Cash $1600
DIvidend declared & paid
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