Question

During January 2020, Orgonite Wellness Clinic completed the following transactions:

Jan

1

Orgonite received $50,000 cash and issued common shares to shareholders

4

Purchased supplies, $5,000, and equipment, $2,500 on account

5

Performed checkup services, and received cash, $2,500

7

Paid cash to acquire land for an office site, $25,000

11

Performed a therapy session, and billed the customer $2500

16

Paid for the equipment, purchased Oct 4 on account

17

Paid the telephone bill, $150

18

Received partial payment from client on account, $2000

22

Paid the water and electricity bills, $500

29

Received $5,000 cash for conducting a workshop on “Healthy Living”

31

Paid employee salary, $4,000

31

Declared and paid dividends of $4,500

Requirements:

Record each transaction in the journal. Key each transaction by date.

Prepare the trial balance of Orgonite, at Jan 31, 2020.

Answer 1

Date	General Journal	Debit	Credit
Jan 1	Cash	$50,000
	Share capital		$50,000
Jan 4	Supplies	$5,000
	Equipment	$2,500
	Sundry Creditors		$7,500
Jan 5	Cash	$2,500
	Service rendered		$2,500
Jan 7	Land	$25,000
	Cash		$25,000
Jan 11	Sundry debtors	$2,500
	Service rendered		$2,500
Jan 16	Sundry Creditors	$2,500
	Cash		$2,500
Jan 17	Telephone expense	$150
	Cash		$150
Jan 18	Cash	$2,000
	Sundry debtors		$2,000
Jan 22	Water and electricity expense	$500
	Cash		$500
Jan 29	Cash	$5,000
	Service rendered		$5,000
Jan 31	Salary	$4,000
	Cash		$4,000
Jan 31	Dividend	$4,500
	Cash		$4,500

Ledgers:

Cash
Share capital	$50,000	Land	$25,000
Service rendered	$2,500	Sundry creditors	$2,500
Sundry debtors	$2,000	Telephone expense	$150
Service rendered	$5,000	Water and electricity expense	$500
		Salary	$4,000
		Dividend	$4,500
		Balance c/d	$22,850
	$59,500		$59,500

.

Share capital
		Cash	$50,000
Balance c/d	$50,000
	$50,000		$50,000

.

service rendered
		Cash	$2,500
		Cash	$5,000
		Sundry debtors	$2,500
Balance c/d	$10,000
	$10,000		$10,000

.

Salary
Cash	$4,000
		Balance c/d	$4,000
	$4,000		$4,000

Dividend
Cash	$4,500
		Balance c/d	$4,500
	$4,500		$4,500

.

Water and elctric expense
Cash	$500
		Balance c/d	$500
	$500		$500

Telephone Charges
Cash	$150
		Balance c/d	$150
	$150		$150

.

Land
Cash	$25,000
		Balance c/d	$25,000
	$25,000		$25,000

Equipment
Sundry Creditors	$2,500
		Balance c/d	$2,500
	$2,500		$2,500

Supplies
Sundry Creditors	$5,000
		Balance c/d	$5,000
	$5,000		$5,000

Sundry Creditors
Cash	$2,500	Supplies	$5,000
		Equipment	$2,500
Balance c/d	$5,000
	$7,500		$7,500

Sundry Debtors
Service rendered	$2,500	Cash	$2,000
		Balance c/d	$500
	$2,000		$2,000

Share capital
		Cash	$50,000
Balance c/d	$50,000
	$50,000		$50,000

Trial Balance
Ledgers Amount	Amount	Ledger Name	Amount
cash	$22,850	Service rendered	$10,000
Salary	$4,000	Sundry Creditors	$5,000
Dividend	$4,500	Share capital	$50,000
Water and elctric expense	$500
Telephone Charges	$150
Land	$25,000
Equipment	$2,500
Supplies	$5,000
Sundry debtors	$500
	$65,000		$65,000