Question

Prepare the general journal entries:

1) June 1 : Purchase supplies on account, $500.

2) June 3: Purchase 200 units of inventory with cash.

3) June 5: Provide 30 hours of services to customers for cash (calculate using your hourly service rate).

4) June 9: Sell 200 units of inventory on account.

5) June 12: Sell 50 units of inventory to a customer on account with a sales discount of 2/10, n/30.

6) June 14: Purchase an additional 100 units of inventory on account.

7) June 20: The customer who purchased product on June 12th pays the amount due (within discount period).

8) June 22: Receive cash in advance for 15 hours of services to be completed in the future.

9) June 27 : Sell 200 units of inventory to a customer who signs a 6 month promissory note at 10% interest for the balance due.

10) June 30: Pay employee salaries, $1,000.

11) June 30: Pay cash dividends to shareholders, $600.

Service Price= $80.00

Sales Price= $65.50

Inventory Cost= $25.00

Answer 1

Formula sheet

A	B	C	D	E	F	G
2
3		Journal Entry for the transactions will be as follows:
4
5		Transaction	Account	Debit	Credit
6		1	Supplies	500
7			Accounts Payable		=E6
8
9		2	Inventory (200*$25)	=200*25
10			Cash		=E9
11
12		3	Cash	=F13
13			Service Revenue (30*$80)		=30*80
14
15		4	Accounts Receivables	=F16
16			Revenue (200*$65.50)		=200*65.5
17
18		5	Accounts Receivables	=F19
19			Revenue (50*$65.50)		=50*65.5
20
21		6	Inventory (100*$25)	=100*25
22			Cash		=E21
23
24		7	Cash ($3,275*(1-2%))	=F26-E25
25			Sales Discounts (2% of $3275)	=F26*2%
26			Account Receivables		=F19
27
28		8	Cash	=F29
29			Unearned Service Revenue (15*$80)		=15*80
30
31		9	Notes Receivables	=F32
32			Revenue (200*$65.50)		=200*65.5
33
34		10	Salaries Expense	1000
35			Cash		=E34
36
37		11	Dividends	600
38			Cash		=E37
39
40