Question

Journalize the following transactions :

01/01 CR1     Shareholder invested $25,000 cash into the company. $10 went to common stock and the remainder went to Shareholder loan. When recording the transaction details make sure that you enter your name somewhere in the description.

01/02              Company negotiated a $20,000 operating line with BNS. Interest will be charged at 4% per annum and the loan covenants limit the amount of the operating line to 60% of good receivables (accounts less than 60 days old). No money is advanced at this time.

01/02 CQ1     Paid monthly rent of $3,000 to Metcalfe Realty.

01/03 CQ2     Paid $500 for office supplies to Grand & Toy. * (Set up as an asset)

01/03 CQ3     Paid $4,000 to Ottawa Business Interiors (OBI) for office equipment. *

01/03 CQ4     Paid $3,000 to Dell Computers for 3 laptops. *

01/03 CQ5     Paid $1,000 to Best Buy for computer software. *

01/08 INV1    Sent a bill for $3,000 to Celebrity Fashion, terms n30. *

01/08 INV2    Sent a bill for $6,000 to Mull Inc. terms n30. *

01/08 CQ6     Paid $450 to Bell Canada for installation of phone system (expense). *

01/15              Paid the following salaries:

To you: CQ7 Salary expense                    $4,000.00

                        CPP expense                      $190.78                                             

                        EI expense                           $92.96

                        CPP payable                       $381.56         

                        EI payable                            $159.36         

                        Income tax payable            $944.64

                        Net pay paid                        $2,798.18

Answer 1

Journal entries	(Amount in $)
date	Particulars	Debit	Credit
jan 1st	Cash A/c Dr	25,000.00
	To Common stock a/c		10.00
	To Shareholders loan a/c		24,990.00
	(Being Shareholders invested money into company and towards common stock is $10 and balance to loan a/c)
2nd jan	This is the facility bank has extended to the company on a credit line as such no utlisation is done no journal entry is required
2nd jan	Rent a/c Dr	3,000.00
	To Cash A/c		3,000.00
	(Being rent paid for the month accounted)
3rd jan	Office supplies-inventory a/c Dr	500.00
	To Cash a/c		500.00
	(Being office supplies purchased from Grand & toy and office supplies are treated as inventory/asset)
3rd jan	office Equipment A/c Dr	4,000.00
	To Cash A/c		4,000.00
	(Being purchase of office equipment done from Ottawa Business Interiors accounted)
3rd jan	Laptop a/c Dr	3,000.00
	To cash A/c		3,000.00
	(Being 3 laptops purchased from Del company accounted)
3rd jan	Computer Software A/c Dr	1,000.00
	To Cash a/c		1,000.00
	(Being Computer software purchased from Best Buy accounted)
8th jan	Accounts receivable a/c Dr	3,000.00
	To Sales a/c		3,000.00
	(Being inv 1 sent to Celebrity fashion, n/30 terms accounted)
8th jan	Accounts receivable a/c Dr	6,000.00
	To Sales a/c		6,000.00
	(Being inv 2 sent to Mull Inc, n/30 terms accounted)
8th jan	Installation charges A/c Dr	450.00
	To cash a/c		450.00
	(Being phone installation charges paid accounted as expenses)
15th jan	Salary A/C Dr	4,000.00
	To Income tax payable a/c		944.64
	To CPP payable A/c		190.78
	To EI payable A/c		66.40
	To Cash A/c		2,798.18
	(Being Salary has been paid after deducting the respective deductions)