Homework SourseDenzel Brooks opened a Web consulting business called Ventur
Denzel Brooks opened a Web consulting business called Venture Consultants and completed the following transactions in March.
Required:
1. Prepare general journal entries to record these transactions using the following titles: Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); Common Stock (307); Dividends (319); Services Revenue (403); and Utilities Expense (690).
2. Post the journal entries from part 1 to the ledger accounts.
3. Prepare a trial balance as of the end of March.
| March | 1 | Brooks invested $150,000 cash along with $22,000 in office equipment in the company in exchange for common stock. | ||
| 2 | The company prepaid $6,000 cash for six months’ rent for an office. (Hint: Debit Prepaid Rent for $6,000.) | |||
| 3 | The company made credit purchases of office equipment for $3,000 and office supplies for $1,200. Payment is due within 10 days. | |||
| 6 | The company completed services for a client and immediately received $4,000 cash. | |||
| 9 | The company completed a $7,500 project for a client, who must pay within 30 days. | |||
| 12 | The company paid $4,200 cash to settle the account payable created on March 3. | |||
| 19 | The company paid $5,000 cash for the premium on a 12-month insurance policy. (Hint: Debit Prepaid Insurance for $5,000.) | |||
| 22 | The company received $3,500 cash as partial payment for the work completed on March 9. | |||
| 25 | The company completed work for another client for $3,820 on credit. | |||
| 29 | The company paid $5,100 cash in dividends. | |||
| 30 | The company purchased $600 of additional office supplies on credit. | |||
| 31 | The company paid $500 cash for this month’s utility bill. |
Solution
Office Equipment A/c Dr. $22,000
To Common Stock $ 172,000
To Cash A/c $6,000
Office Supplies A/c Dr. $ 1,200
To Account Payable A/c $ 4,200
To Service Revenue A/c $ 4,000
To Service Revenue A/c $7,500
To Cash A/c $ 4,200
To Cash A/c $ 5,000
To Accounts Receivable A/c $ 3,500
To Service Revenue A/c $ 3,820
To Cash A/c $ 5,100
To Accounts Payable A/c $ 600
To Cash A/c $ 500
TRIAL BALANCE;
Cash (101) $136,700
Accounts Receivable (106) $ 7,820
Office Supplies (124) $1,800
Prepaid Insurance (128) $ 5000
Prepaid Rent (131) $ 6000
Office Equipment (163) $ 25,000
Account Payable (201) $ 600
Common Stock (307) $ 172,000
Dividends (319) $ 5,100
Service Revenue (403) $ 15,320
Utilities Expense (690) $ 500
