Denzel Brooks opened a Web consulting business called Venture Consultants and co

Question

Denzel Brooks opened a Web consulting business called Venture Consultants and completed the following transactions in March.
  

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 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.

Explanation / Answer

Office Equipment A/c Dr. $22,000

To Common Stock $ 172,000

To Cash A/c $6,000

Office Supplies A/c     Dr. $ 1,200

                To Account Payable A/c $ 4,200

To Service Revenue A/c $ 4,000

To Service Revenue A/c $7,500

To Cash A/c $ 4,200

To Cash A/c $ 5,000

To Accounts Receivable A/c $ 3,500

To Service Revenue A/c $ 3,820

To Cash A/c $ 5,100

To Accounts Payable A/c $ 600

To Cash A/c $ 500

TRIAL BALANCE;

Cash (101) $136,700

Accounts Receivable (106) $ 7,820

Office Supplies (124) $1,800

Prepaid Insurance (128) $ 5000

Prepaid Rent (131) $ 6000

Office Equipment (163) $ 25,000

Account Payable (201) $ 600

Common Stock (307) $ 172,000

Dividends (319) $ 5,100

Service Revenue (403) $ 15,320

Utilities Expense (690) $ 500

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