Hokies uses the following accounts Equipment Supplies Accoun

Hokies uses the following accounts Equipment Supplies Accounts Payable Cash Prepaid Rent Common Stock Salaries Payable ent Expense Notes Payable Salaries Expense Accounts Receivable Utilities Expense Service Revenue Retained Earnings Dividends Required Indicate which accounts should be debited and which should be credited for the following transactions of Hokies company. Transactions Account Debited Account Credited Example: Purchase equipment in exchange for cash 1. Pay a cash dividend 2. Pay rent in advance for the next three months 3. Provide services to customers on account. 4. Purchase office supplies on account. 5. Pay salaries for the current month 6. Issue common stock in exchange for cash Equipment Cash Collect cash from customers for services provided in (3) above 8. Borrow cash from the bank and sign a note 9.Pay for the current month\'s utilities 10. Pay for office supplies purchased in (4) above

Solution

a) Retained Earnings

b) Dividend

a) Dividends

b) Cash

a) Salaries expense

b) Salaries Payable

a) Salaries Payable

b) Cash

	Transactions	Account Debited	Account Credited
1	Pay a cash dividend	a) Retained Earnings b) Dividend	a) Dividends b) Cash
2	Pay rent in advance for next 3 months	Prepaid rent	Cash
3	Provide services to customer on account	Account receivable	Service Revenue
4	Purchase office supplies on account	Supplies	Accounts Payable
5	Pay salaries for current month	a) Salaries expense b) Salaries Payable	a) Salaries Payable b) Cash
6	Issue common stock in exchange of cash	Cash	Common stock
7	Collect cash for services provided in (3) above	Cash	Accounts Receivable
8	Borrow cash from bank and sign a note	Cash	Notes payable
9	Pay for the current month\'s utilities	Utilities Expense	Cash
10	Pay for office supplies purchased in (4) above	Accounts Payable	Cash