Question

REQUIREMENT #8

Okay, I have a case study I need to complete by the end of this week but I am stuck. Plus, I need to make sure that I am doing this correctly. It is a layered challenge. I will have to send the study in pieces because I could not attach the actual document.   

Requirement #8:                      
                      
Prepare the closing entries at July 31 in the General Journal below.                      
                      
       General Journal              
Date   Description (Account Name)           Debit   Credit  

During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation,                                              
completed the following transactions.                                              
                                              
July 1   Began business by making a deposit in a company bank account of $60,000, in exchange                                          
   for 6,000 shares of $10 par value common stock.                                          
                                              
July 3   Paid the current month's rent, $3,500                                          
                                              
July 5   Paid the premium on a 1-year insurance policy, $4,200                                          
                                              
July 7   Purchased supplies on account from Little Company, $1,000.                                          
                                              
July 10   Paid employee salaries, $3,500                                          
                                              
July 14   Purchased equipment from Lake Company, $10,000. Paid $2,500 down and the balance was                                          
   placed on account. Payments will be $500.00 per month until the equipment is paid. The first payment is due 8/1.                                          
   Note: Use accounts payable for the balance due.                                          
                                              
July 15   Received cash for preparing tax returns for the first half of July, $8,000                                          
                                              
July 19   Made payment on account to Lake Company, $500.                                          
                                              
July 31   Received cash for preparing tax returns for the last half of July, $9,000                                          
                                              
July 31   Declared and paid cash dividends of $600.                     

Answer 1

Date	Particulars	Debit ($)	Credit ($)
July 1	Cash	60,000
	Common stock (6000 *10)		60,000
	(To record issue of shares)
July 3	Rent expenses	3500
	Cash		3500
	(To record rent expenses)
July 5	Prepaid insurance	4200
	Cash		4200
	(TO record payment of insurance premium)
July 7	Supplies	1000
	Little company		1000
	(To record purchases on account)
July 10	Salaries	3500
	Cash		3500
	(To record salaries payment)
July 14	Equipment	10,000
	Cash		2500
	Lake company		7,500
	(To record equipment purchases)
July 15	Cash	8000
	Service revenue		8000
	(To record receipt of revenue)
July 19	Lake company	500
	Cash		500
	(To record payment of instalment)
July 31	Cash	9000
	Service revenue		9000
	(To record revenue receipt)
July 31	Dividends	600
	Cash		600
	(To record payment of dividends)

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