Chapter 2--Analyzing Transactions
221. On
November 10th, JumpStart Co. provides $2,900 in services to clients. At the
time of service, the clients paid $600.00 in cash and put the balance on
account.
(a) Journalize this event.
(b) On November 20th, JumpStart Co. clients paid an additional $900 on
their accounts due. Journalize this event.
(c) Calculate the amount of accounts receivable on November 30th.
222. Journalize
the following selected transactions for April 2011 in a two-column
journal. Journal entry explanations may be omitted.
|
April 1 |
Received cash for capital stock, $14,000. |
|
2 |
Received cash for providing accounting services, $9,500. |
|
3 |
Billed customers on account for providing services, $4,200. |
|
4 |
Paid advertising expense, $700. |
|
5 |
Received cash from customers on account, $2,500. |
|
6 |
Paid cash dividends, $1,000. |
|
7 |
Received telephone bill, $900. |
|
8 |
Paid telephone bill, $900. |
|
|
|
Post. Ref. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
223. Analyze
the following transactions as to their effect on the accounting equation.
|
(a) |
The company paid $725 to a vendor for supplies purchased previously on account. |
|
(b) |
The company performed $850 of services and billed the customer. |
|
(c) |
The company received a utility bill for $395 and will pay it next month. |
|
(d) |
The stockholder of the company received a cash dividend of $1,000. |
|
(e) |
The company paid $315 in salaries to its employees. |
|
(f) |
The company collected $730 of cash from its customers on account. |
Some of the possible effects of a transaction on the accounting equation are
listed below:
|
(1) |
Asset, dr.; Asset, cr. |
|
(2) |
Liability, dr.; Revenue, cr. |
|
(3) |
Asset, dr.; Liability, cr. |
|
(4) |
Asset, dr.; Revenue, cr. |
|
(5) |
Liability, dr.; Assets, cr. |
|
(6) |
Equity, dr.; Asset, cr. |
|
(7) |
Expense, dr.; Assets, cr. |
|
(8) |
Expense, dr.; Liability, cr. |
Put the appropriate letter next to each transaction.
224. Set
up T accounts for Cash, Accounts Receivable, Supplies, Accounts Payable,
Capital Stock, Dividends, Professional Fees, and Operating Expenses.
|
(a) |
In the T accounts, record the following transactions of Potter Pool Services for June, 2011, identifying each entry by number: |
|
|
|
(1) |
Dan Potter invested $12,500 cash in the business in exchange for stock. |
|
|
(2) |
Purchased supplies on account, $6,250. |
|
|
(3) |
Paid operating expenses, $5,500. |
|
|
(4) |
Billed clients for fees, $7,440. |
|
|
(5) |
Received cash from cash clients, $4,700. |
|
|
(6) |
Paid creditors on account, $1,400. |
|
|
(7) |
Received $3,100 from clients on account. |
|
|
(8) |
The company paid Dan $1,500 in cash dividends. |
|
|
|
|
|
(b) |
Prepare a trial balance as of June 30, 2011 for Potter Pool Services. |
|
|
|
|
|
|
(c) |
Assuming that supplies expense (which has not been recorded) amounts to $1,500 for June, determine net income for the month. |
|
225. Prepare
a trial balance, listing the following accounts in proper sequence. The
accounts (all normal balances) were taken from the ledger of Sophie Designs Co.
on April 30, 2014.
|
Accounts Payable |
$ 4,100 |
|
Rent Expense |
$ 1,500 |
|
Accounts Receivable |
3,450 |
|
Salary Expense |
14,000 |
|
Cash |
6,700 |
|
Fees Earned |
45,425 |
|
Capital Stock |
10,000 |
|
Supplies |
3,125 |
|
Dividends |
7,500 |
|
Supplies Expense |
1,700 |
|
Equipment |
24,500 |
|
Utilities Expense |
4,000 |
|
Miscellaneous Expense |
850 |
|
Retained Earnings |
7,800 |
-
Rating:
/5
Solution: Chapter 2--Analyzing Transactions