The following information applies to the questions displayed below. Green Wave C

Question

The following information applies to the questions displayed below. Green Wave Company plans to own and operate a storage rental facility. For the first month of operations, the company has the following transactions 1. January 1 Issue 10,000 shares of common stock in exchange for $22,000 in cash. 2. January 5 Purchase land for $14,000. A note payable is signed for the full amount. 3. January 9 Purchase storage container equipment for $7,000 cash 4. January 12 Hire three employees for $1,000 per month. 5. January 18 Receive cash of $11,000 in rental fees for the current month 6. January 23 Purchase office supplies for $1,000 on account. 7. January 31 Pay employees $3,000 for the first month's salaries. References

Explanation / Answer

Part 1 - Journal Entry Worksheet of green wave company

Part 2 - Ledgers of Green wave Company

Cash

Service revenue

Salary expenses

$11000

($3000)

Land

Common stock

$22000

Notes Payable

Salary expenses

Supplies

Equipment

Accounts Payable

Service revenue

Part 3 - Trial Balance of green wave company

Green Wave company

Trial Balance

Transaction General Journal Debit Credit 1 Cash $22000 Common stock $22000 (Being cash received on issue of common stock) 2 Land $14000 Notes Payable $14000 (Land purchased against issue of note) 3 Equipment $7000 Cash $7000 (Equipment purchased on cash paymeny basis) 4 No Entry (No entry required since there is no transaction involved) 5 Cash $11000 Service Revenue $11000 (Cash received for service provided) 6 Supplies $1000 Accounts Payable $1000 (Supplies purchased on credit terms) 7 Salary expenses $3000 Cash $3000 (Salary paid to employees)

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