ezto.mheducation.com uD McGraw-Hill Connect eWeber M3-13 Preparing Accrual Basis
ID: 2608548 • Letter: E
Question
ezto.mheducation.com uD McGraw-Hill Connect eWeber M3-13 Preparing Accrual Basis Journal Entries for Business Activities [LO 3-3] Quick Cleaners, Inc. (QCI) has been in business for several years. It specializes in cleaning houses but has some small business clients as well. a. Issued $18,000 of QCI stock for cash. b. Incurred $895 of utbilities costs this month and will pay them next month. c. Paid wages for the current month, totaling $3,100. d. Performed cleaning services on account worth $4,500 e. Some of Quick Cleaners' equipment was repaired at a total cost of $302. The company paid the full amount at the time the repair work was done. 1. Prepare jounal entries for the above transactions, which occurred during a recent month. (If no entry is required for a transactionlevent, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Issued $18,000 of QCI stock for cash. Record the transaction. Note: Enter debits before credits Transaction General Journal Debit Credit Record entry Clear entry View general journal 2. Determine QCI's preliminary net income.Explanation / Answer
Solution:
Journal Entries
Transaction
General Journal
Debit
Credit
a)
Cash
$18,000
Common Stock
$18,000
(Issued common stock for cash recorded)
b)
Utility Expense
$895
Accounts Payable
$895
(Recorded Utilities expenses for the month)
c)
Salary and Wages Expense
$3,100
Cash
$3,100
(Wages paid in cash for the month recorded)
d)
Accounts Receivable
$4,500
Service Revenue
$4,500
(Recorded cleaning services performed on account)
e)
Repair Expense
Cash
(Recorded repair work done on equipment)
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Transaction
General Journal
Debit
Credit
a)
Cash
$18,000
Common Stock
$18,000
(Issued common stock for cash recorded)
b)
Utility Expense
$895
Accounts Payable
$895
(Recorded Utilities expenses for the month)
c)
Salary and Wages Expense
$3,100
Cash
$3,100
(Wages paid in cash for the month recorded)
d)
Accounts Receivable
$4,500
Service Revenue
$4,500
(Recorded cleaning services performed on account)
e)
Repair Expense
Cash
(Recorded repair work done on equipment)
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