Question

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Green Wave Company plans to own and operate a storage rental facility. For the first month of operations, the company has the following transactions.
1. January 1 Issue 10,000 shares of common stock in exchange for $35,000 in cash.
2. January 5 Purchase land for $20,500. A note payable is signed for the full amount.
3. January 9 Purchase storage container equipment for $8,300 cash.
4. January 12 Hire three employees for $2,300 per month.
5. January 18 Receive cash of $12,300 in rental fees for the current month.
6. January 23 Purchase office supplies for $2,300 on account.
7. January 31 Pay employees $6,900 for the first month's salaries.
Post each transaction to T-accounts and calculate the ending balance for each account. For each posting, indicate the corresponding transaction number and the appropriate transaction amount. Since this is the first month of operations, all T-accounts have a beginning balance of zero.

Answer 1

Answer:

Green Wave Company

T-Ledger Accounts:

1.                                   Common Stock Account

                                                 Jan. 1      Cash Account $35,000

                                     Cash Account

1.  Jan. 1 Common Stock     $35,000  3. Jan. 9 Equipment $8,300

5. Jan 18 Rental Fees          $12,300   7. Jan. 31 Salaries    $6,900

                                                                Jan. 31 Balance  $32,100

                                            $47,300                                 $47,300

Feb. 1 Balance                     $32,100

2.                                   Land Account

   Jan. 5 Note Payable      $20,500

2.                                   Note Payable Account

                                                 Jan. 5      Land                  $20,500

3.                                   Equipment Account

   Jan. 9 Cash                     $8,300

5.                                   Rental Fees Revenue

                                                Jan. 18    Cash                   $12,300

6.                                  Office Supplies

  Jan. 23 Accounts Payable  $2,300

6.                                    Accounts Payable

                                                      Jan. 23 Office Supplies  $2,300

7.                                    Salaries Expense

  Jan. 31   Cash                     $6,900

Explanation:

T-Ledger accounts are ledger accounts in the form of the letter T.  It has debit on the left-hand side and credit on the right-hand side.  It is an accounting tool for determining balances.