Part 1 Arizona Consultants Inc opened in March and completed

Part 1: Arizona Consultants, Inc. opened in March and completed the following transactions: March 1: Arizona Consultants Inc. issued 17,200 shares of $10 par value capital stock for $150,000 cash and equipment with fair market value of $22,000. March 2: Arizona Consultants Inc. pre-paid $6,000 cash or six months\' rent for their office. March 3: Arizona Consultants Inc. made credit purchases for office equipment for $3,000 and office supplies for $1,200. Payment is due within 10 days March 6: Arizona Consultants Inc. completed services for a client and immediately received $4,000 cash. March 9: Arizona Consultants Inc. completed a $7,500 project for a client who must pay within 30 days March 12: Arizona Consultants Inc. paid $4,200 cash to settle the account payable created on March 3. March 19: Arizona Consultants Inc. paid a $5,000 cash premium on a 12-month insurance policy. March 22: Arizona Consultants Inc. received $3,500 cash as a partial payment for the work completed on March 9 March 25: Arizona Consultants Inc. completed work for another client for $3,820 on credit. March 29: Arizona Consultants Inc. declared dividends of $5,000 to its shareholders on record. Dividends were paid in cash the following day March 30: Arizona Consultants Inc. purchased $600 of additional office supplies on credit. March 31: Arizona Consultants Inc. paid $500 cash for this month\'s utility bill. Instructions: Using the following template, prepare journal entries for the above economic transactions. Enter your journals to the general ledger using the same file name. The following accounts should be used in recording your transactions: cash, accounts receivable, prepaid rent, office equipment, capital stock, prepaid insurance, office supplies, accounts payable, consulting revenue, dividends, and utility expense

Solution

Journal Entries: Date Accounts Titles Debit $ Credit$ 1-Mar Cash 172000 Capital Stock 172000 (being stock issued for cash or equivalent) 2-Mar Prepaid rent 6000 Cash 6000 (being rent made prepaid for six months) 3-Mar Offi equip 3000 offi supplies 1200 AP 4200 (being off equip and supplies purchased on credit) 6-Mar Cash 4000 Service revenue 4000 (being cash received on completed services) 9-Mar AR 7500 Service revenue 7500 (being AR created for services completed) 12-Mar AP 4200 Cash 4200 (being AP paid) 19-Mar Prepaid insurance 5000 Cash 5000 (being prepaid insu for 12 months) 22-Mar Cash 3500 AR 3500 (being amount received of AR) 25-Mar AR 3820 Service revenue 3820 (being AR created for services completed) 29-Mar Dividend exp 5000 Cash 5000 (being dividend paid) 30-Mar Off supplies 600 AP 600 (being off supplies taken on credit) 31-Mar Utilities expe 500 Cash 500 (being utilities paid in cash) T-Accounts: DEBIT AMOUNT$ CREDIT AMOUNT$ Cash a/c: 1 172000 2 6000 6 4000 12 4200 22 3500 19 5000 29 5000 31 500 c/b 158800 179500 179500 capital stock a/c: 1 172000 Prepaid rent a/c: 2 6000 Off equipment a/c: 3 3000 Off Supplies a/c: 3 1200 30 600 AP a/c : 12 4200 3 4200 c/b 600 30 600 Service Revenues a/c: 6 4000 9 7500 c/b 15320 25 3820 AR a/c : 9 7500 22 3500 35 3820 c/b 7820 Prepaid Insu A/c: 19 5000 Dividend exp a/c: 29 5000 Utilities exp a/c : 31 500