Question

Record the following transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) (a) Started business by issuing 10,000 shares of common stock for $20,000. (b) Hired Rebecca as an administrative assistant, promising to pay her $2,700 every two weeks. (c) Rented a building for three years at $590 per month and paid six months' rent in advance. (d) Purchased equipment for $5,100 cash. (e) Purchased $2,100 of supplies on account. (f) Provided services to customers for $7,600 cash. (g) Paid employees’ salaries, $5,900. (h) Paid for supplies purchased in item (e). (i) Paid $900 for current advertising in a local newspaper. (j) Paid utility bill of $1,900 for the current month.

Answer 1

Ans.
	Journal Entries
	Account Titles			Dr. ($)	Cr. ($)
a)	Cash			20,000
	To Common stock				20,000
	(Being Started Business by issuing 10,000 common shares at $2 per share)
						b)	Administrative Assistant Salary			2,700
	To Cash				2,700
	(Being Pay administrative assistant salary for two weeks)
c)	Advance Rent			3,540
	To Cash				3,540
	(Being Advance rent paid for six months)
d)	Equipment			5,100
	To Cash				5,100
	(Being Equipment purchased on cash)
e)	Supplies			2,100
	To Accounts Payable				2,100
	(Being Supplies purchase on credit)
f)	Cash			7,600
	To Service Revenue Earned				7,600
	(Being services provided to customers in cash)
g)	Employees' Salary			5,900
	To Cash				5,900
	(Being Employees Salary paid in cash)
h)	Accounts Payable			2,100
	To Cash				2100
	(Being cash paid to creditors for purchased of supplies earlier)
						i)	Advertisement Expenses			900
							To Cash				900
	(Being Advertisement expense in local newspaper paid)
j)	Utility Expense			1,900
	To Cash				1,900
	(Being Utility bill expense for current month paid)