Comprehensive Computer Program Page 6 The Corporation perfor

Comprehensive Computer Program, Page 6 The Corporation performs adjusting entries monthly. Closing entries are performed annually on December 31. During December the following transactions occurred: Issued 20,000 shares of capital stock to Paula Petersen Dec. 1 total of $40,000 cash. and other investors in exchange for a Dec. 1 Prepaid Rent for the entire amount). Paid $9,600 to Mages Realty for 12 months rent paid in advance. (Use the Asset account: count Dec. 2 Plumbing Equipment). Paid s,000 in cash with the balance due on a Note interest due in 6 months). Purchased plumbing repair equipment and tools from Host Corp. for $15,000 (use the ac Payable (principal and Purchased office supplies on Account from Clousers for $1,000. Payment is due in 15 days. Dec. 4 These supplies are expected to last for several months. Dec. 5 Purchased a 6 month business Insurance Policy for S1,200 from the Seyler Agency (use the Asset account Unexpired Insurance for the entire amount) Dec. 10 Received $4,000 cash from the Wink Apartment Complex in Exeter Township as advance yment for services to be provided. (Use the Liability account: Unearned Plumbing Fees.) Dec. 16 Paid employee salaries for the first two weeks of December, $2,000. Dec. 16 Earned $7,500 in fees for plumbing repairs completed in the first two weeks of December. $3,000 was received in cash and the remainder was billed to PPI\'s customers on Account (due in 10 days.) Dec. 19 Paid the amount due to Clousers on account from the Dec. 4th purchase. Dec. 26 Received amount due on account from the December 16h billing. Dec. 27 PPI was named, along with Mages Agency, as a co-defendant in a S15,000 lawsuit filed on behalf of Joseph Walker. Walker slipped on ice outside of the shop and broke his leg. The extent of the Corporation\'s legal and financial responsibility, if any, can not be determined at this time. (Note: this event does not need a journal entry at this time, but may require disclosure in the notes accompanying the financial statements Dec. 30 Received a phone bill for the month of December from Sprint in the amount of $300. The amount is due on January 15, 2017 Dec. 30 Declared a cash dividend of $.05 (5 cents) per share, payable on January 15, 2017. Dec. 31 Earned $9,000 in fees for plumbing repairs provided for the second two weeks of December $4,000 was received in cash and the remainder was billed to PPI\'s customers on Account (due in 12 days.)

Solution

Date Accounts title Dr Cr 1-Dec Cash $40,000 Common stock $40,000 1-Dec Prepaid Rent $9,600 CAsh $9,600 2-Dec Plumbing equipment $15,000 Cash $5,000 Notes payable 10000 4-Dec Office Supplies $1,000 Accounts payable $1,000 5-Dec Unexpired Insurance $1,200 Cash $1,200 10-Dec Cash $4,000 Uneraned Plumbing Revenue $4,000 16-Dec Payroll expenses $2,000 Cash $2,000 16-Dec Cash $3,000 Accounts Receivable 4500 Plumbing Revenue Earned 7500 19-Dec Accounts payable $1,000 Cash $1,000 26-Dec Cash $4,500 Accounts Receivable $4,500 27-Dec No journal entry required 30-Dec Utilities expenses $300 Accounts payable $300 30-Dec Dividends $1,000 Cash (20000*.05) $1,000 31-Dec Cash $4,000 Accounts Receivable 8000 Plumbing Revenue Earned 12000 If any doubt plese comment. If satisfied you can rate