Denzel Brooks opened a Web consulting business called Venture Consultants and co
ID: 2410004 • Letter: D
Question
Denzel Brooks opened a Web consulting business called Venture Consultants and completed the following transactions in March March 1 Brooks invested $150,000 cash along with $22,000 in office equipment in the company in exchange for common stock. 2 The company prepaid $6,000 cash for six months' rent for an office. (Hint: Debit Prepaid Rent for $6,000.) 3 The company made credit purchases of office equipment for $3,000 and office supplies for $1,200. Payment is due within 10 days. 6 The company completed services for a client and immediately received $4,000 cash. 9 The company completed a $7,500 project for a client, who must pay within 30 days. 12 The company paid $4,200 cash to settle the account payable created on March 3. 19 The company paid $5,000 cash for the premium on a 12-month insurance policy. (Hint: Debit Prepaid Insurance for $5,000.) 22 The company received $3,500 cash as partial payment for the work completed on March 9. 25 The company completed work for another client for $3,820 on credit. 29 The company paid $5,100 cash in dividends. 30 The company purchased $600 of additional office supplies on credit. 31 The company paid $500 cash for this month's utility bill Required: 1. Prepare general journal entries to record these transactions using the following titles: Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); Common Stock (307); Dividends (319); Services Revenue (403); and Utilities Expense (690) 2. Post the journal entries from part 1 to the ledger accounts 3. Prepare a trial balance as of the end of MarchExplanation / Answer
Venture Consultants
Journal entries to the record the transactions:
Journal Entries
Date
Account Titles and Explanation
Ref
Debit
Credit
1-Mar
Cash
101
$150,000
Office Equipment
163
$22,000
Common Stock
307
$172,000
(To record cash and equipment invested in business)
2-Mar
Prepaid Rent
131
$6,000
Cash
101
$6,000
(To record prepaid rent for 6 months)
3-Mar
Office Equipment
163
$3,000
Office Supplies
124
$1,200
Accounts Payable
201
$4,200
(To record purchase of equipment and supplies on account)
6-Mar
Cash
101
$4,000
Service Revenue
403
$4,000
(To record cash received for services performed)
9-Mar
Accounts Receivable
106
$7,500
Service Revenue
403
$7,500
(To record servcies performed on account)
12-Mar
Accounts Payable
201
$4,200
Cash
101
$4,200
(To record payment of accounts payable)
19-Mar
Prepaid Insurance
128
$5,000
Cash
101
$5,000
(To record purchase of insurance premium for 12 months)
22-Mar
Cash
101
$3,500
Accounts Receivable
106
$3,500
(To record cash received against accounts receivable)
25-Mar
Accounts Receivable
106
$3,820
Service Revenue
403
$3,820
(To record services performed on account)
29-Mar
Dividends
319
$5,100
Cash
101
$5,100
(To record payment of dividends)
30-Mar
Office Supplies
124
$600
Accounts Payable
201
$600
(To record purchase of supplies on account)
31-Mar
Utilities Expenses
690
$500
Cash
101
$500
(To record payment of utility bill)
Ledger Accounts
Cash
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
1-Mar
Common Stock
307
$150,000
2-Mar
Prepaid Rent
131
$6,000
6-Mar
Service Revenue
403
$4,000
12-Mar
Accounts Payable
201
$4,200
22-Mar
Accounts Receivable
106
$3,500
19-Mar
Prepaid Insurance
128
$5,000
29-Mar
Dividends
319
$5,100
31-Mar
Utilities Expense
690
$500
31-Mar
Balance
$136,700
$157,500
$157,500
Office Equipment
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
1-Mar
Common Stock
307
$22,000
3-Mar
Accounts Payable
201
$3,000
31-Mar
Balance
$25,000
$25,000
$25,000
Office Supplies
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
3-Mar
Accounts Payable
201
$1,200
30-Mar
Accounts Payable
201
$600
31-Mar
Balance
$1,800
$1,800
$1,800
Accounts Receivable
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
9-Mar
Service Revenue
403
$7,500
22-Mar
Cash
101
$3,500
25-Mar
Service Revenue
403
$3,820
31-Mar
Balance
$7,820
$11,320
$11,320
Prepaid Rent
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
2-Mar
Cash
101
$6,000
31-Mar
Balance
$6,000
$6,000
$6,000
Prepaid Insurance
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
19-Mar
Cash
101
$5,000
31-Mar
Balance
$5,000
$5,000
$5,000
Accounts Payable
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
12-Mar
Cash
101
$4,200
3-Mar
Office Equipment
163
$3,000
31-Mar
Balance
$600
3-Mar
Office Supplies
124
$1,200
30-Mar
Office Supplies
124
$600
$4,800
$4,800
Common Stock
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
1-Mar
Cash
101
$150,000
31-Mar
Balance
$172,000
1-Mar
Office Equipment
163
$22,000
$172,000
$172,000
Dividends
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
29-Mar
Cash
101
$5,100
31-Mar
Balance
$5,100
$5,100
$5,100
Service Revenue
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
6-Mar
Cash
101
$4,000
9-Mar
Accounts Receivable
106
$7,500
31-Mar
Balance
$15,320
25-Mar
Accounts Receivable
106
$3,820
$15,320
$15,320
Utilities Expense
Dr
Cr
Date
Description
ref
Amount
Date
Description
Ref
Amount
31-Mar
Cash
101
$500
31-Mar
Balance
$500
$500
$500
Trial Balance
Accounts Titles
Ref
Debit
Credit
Cash
101
$136,700
Accounts Receivable
106
$7,820
Office Supplies
124
$1,800
Prepaid Insurance
128
$5,000
Prepaid Rent
131
$6,000
Office Equipment
163
$25,000
Accounts Payable
201
$600
Common Stock
$172,000
Dividends
319
$5,100
Service Revenue
403
$15,320
Utilities Expense
690
$500
Totals
$187,920
$187,920
Journal Entries
Date
Account Titles and Explanation
Ref
Debit
Credit
1-Mar
Cash
101
$150,000
Office Equipment
163
$22,000
Common Stock
307
$172,000
(To record cash and equipment invested in business)
2-Mar
Prepaid Rent
131
$6,000
Cash
101
$6,000
(To record prepaid rent for 6 months)
3-Mar
Office Equipment
163
$3,000
Office Supplies
124
$1,200
Accounts Payable
201
$4,200
(To record purchase of equipment and supplies on account)
6-Mar
Cash
101
$4,000
Service Revenue
403
$4,000
(To record cash received for services performed)
9-Mar
Accounts Receivable
106
$7,500
Service Revenue
403
$7,500
(To record servcies performed on account)
12-Mar
Accounts Payable
201
$4,200
Cash
101
$4,200
(To record payment of accounts payable)
19-Mar
Prepaid Insurance
128
$5,000
Cash
101
$5,000
(To record purchase of insurance premium for 12 months)
22-Mar
Cash
101
$3,500
Accounts Receivable
106
$3,500
(To record cash received against accounts receivable)
25-Mar
Accounts Receivable
106
$3,820
Service Revenue
403
$3,820
(To record services performed on account)
29-Mar
Dividends
319
$5,100
Cash
101
$5,100
(To record payment of dividends)
30-Mar
Office Supplies
124
$600
Accounts Payable
201
$600
(To record purchase of supplies on account)
31-Mar
Utilities Expenses
690
$500
Cash
101
$500
(To record payment of utility bill)
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