logistic_guy
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- Apr 17, 2024
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\(\displaystyle \text{Maquoketa}\) Services was formed on May \(\displaystyle 1, 2017\). The following transactions took place during the first month.
Transactions on May \(\displaystyle 1\):
\(\displaystyle \bold{1.}\) Jay Bradford invested \(\displaystyle \$40,000\) cash in the company, as its sole owner.
\(\displaystyle \bold{2.}\) Hired two employees to work in the warehouse. They will each be paid a salary of \(\displaystyle \$3,050\) per month.
\(\displaystyle \bold{3.}\) Signed a \(\displaystyle 2\)-year rental agreement on a warehouse; paid \(\displaystyle \$24,000\) cash in advance for the first year.
\(\displaystyle \bold{4.}\) Purchased furniture and equipment costing \(\displaystyle \$30,000\). A cash payment of \(\displaystyle \$10,000\) was made immediately; the remainder will be paid in \(\displaystyle 6\) months.
\(\displaystyle \bold{5.}\) Paid \(\displaystyle \$1,800\) cash for a one-year insurance policy on the furniture and equipment.
Transactions during the remainder of the month:
\(\displaystyle \bold{6.}\) Purchased basic office supplies for \(\displaystyle \$420\) cash.
\(\displaystyle \bold{7.}\) Purchased more office supplies for \(\displaystyle \$1,500\) on account.
\(\displaystyle \bold{8.}\) Total revenues earned were \(\displaystyle \$20,000\)—\(\displaystyle \$8,000\) cash and \(\displaystyle \$12,000\) on account.
\(\displaystyle \bold{9.}\) Paid \(\displaystyle \$400\) to suppliers for accounts payable due.
\(\displaystyle \bold{10.}\) Received \(\displaystyle \$3,000\) from customers in payment of accounts receivable.
\(\displaystyle \bold{11.}\) Received utility bills in the amount of \(\displaystyle \$380\), to be paid next month.
\(\displaystyle \bold{12.}\) Paid the monthly salaries of the two employees, totaling \(\displaystyle \$6,100\).
Instructions
\(\displaystyle \bold{(a)}\) Prepare \(\displaystyle \text{journal entries}\) to record each of the events listed. (Omit explanations.)
\(\displaystyle \bold{(b)}\) Post the journal entries to \(\displaystyle \text{T}\)-accounts.
\(\displaystyle \bold{(c)}\) Prepare a \(\displaystyle \text{trial balance}\) as of May \(\displaystyle 31, 2017\).
Transactions on May \(\displaystyle 1\):
\(\displaystyle \bold{1.}\) Jay Bradford invested \(\displaystyle \$40,000\) cash in the company, as its sole owner.
\(\displaystyle \bold{2.}\) Hired two employees to work in the warehouse. They will each be paid a salary of \(\displaystyle \$3,050\) per month.
\(\displaystyle \bold{3.}\) Signed a \(\displaystyle 2\)-year rental agreement on a warehouse; paid \(\displaystyle \$24,000\) cash in advance for the first year.
\(\displaystyle \bold{4.}\) Purchased furniture and equipment costing \(\displaystyle \$30,000\). A cash payment of \(\displaystyle \$10,000\) was made immediately; the remainder will be paid in \(\displaystyle 6\) months.
\(\displaystyle \bold{5.}\) Paid \(\displaystyle \$1,800\) cash for a one-year insurance policy on the furniture and equipment.
Transactions during the remainder of the month:
\(\displaystyle \bold{6.}\) Purchased basic office supplies for \(\displaystyle \$420\) cash.
\(\displaystyle \bold{7.}\) Purchased more office supplies for \(\displaystyle \$1,500\) on account.
\(\displaystyle \bold{8.}\) Total revenues earned were \(\displaystyle \$20,000\)—\(\displaystyle \$8,000\) cash and \(\displaystyle \$12,000\) on account.
\(\displaystyle \bold{9.}\) Paid \(\displaystyle \$400\) to suppliers for accounts payable due.
\(\displaystyle \bold{10.}\) Received \(\displaystyle \$3,000\) from customers in payment of accounts receivable.
\(\displaystyle \bold{11.}\) Received utility bills in the amount of \(\displaystyle \$380\), to be paid next month.
\(\displaystyle \bold{12.}\) Paid the monthly salaries of the two employees, totaling \(\displaystyle \$6,100\).
Instructions
\(\displaystyle \bold{(a)}\) Prepare \(\displaystyle \text{journal entries}\) to record each of the events listed. (Omit explanations.)
\(\displaystyle \bold{(b)}\) Post the journal entries to \(\displaystyle \text{T}\)-accounts.
\(\displaystyle \bold{(c)}\) Prepare a \(\displaystyle \text{trial balance}\) as of May \(\displaystyle 31, 2017\).
