1. Stockholders invested $14,289 cash in the business in exchange for common sto
ID: 2759156 • Letter: 1
Question
1. Stockholders invested $14,289 cash in the business in exchange for common stock. 2. Purchased equipment for $5,376 cash. 3. Paid $460 cash for May office rent. 4. Paid $634 cash for supplies. 5. Incurred $183 of advertising costs in the Beacon News on account. 6. Received $3,817 in cash from customers for repair service. 7. Declared and paid a $1,352 cash dividend. 8. Paid part-time employee salaries $829. 9. Paid utility bills $157. 10. Performed repair services worth $988 on account. 11. Collected cash of $124 for services billed in transaction (10).
Explanation / Answer
Journal entries
1) Cash A/c Dr. $14289
To Common Stock A/c $14289
2) Equipment A/c Dr. $5376
To Cash A/c $5376
3) Office Rent A/c Dr. $460
To Cash A/c $460
4) purchase A/c Dr. $634
To Cash A/c $634
5) Advertisement Expense A/c Dr. $183
To Beacon news A/c $183
6) Cash A/c Dr. $3817
To Income (Repair Service) $3817
7) Dividend A/c Dr. $1352
To Cash A/c $1352
8) Salary A/c Dr. $829
To Cash a/c $829
9) utility Exp A/c Dr. $157
TO Cash a/c $157
10) Debtor A/c Dr. $988
To Income (Repair Service) $988
11) Cash a/c Dr. $ 124
To Debtor A/c $124
Cash balance = $14289-$5376-$460-$634+$3817-$1352-$829-$157+$124 = $9422
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