Question

Use below information to prepare general journal entries for Belle Co.’s 1 through 7 transactions.

a. D. Belle created a new business and invested $5,900 cash, $6,900 of equipment, and $12,900 in web servers in exchange for common stock.
b. The company paid $6,000 cash in advance for prepaid insurance coverage.
c. The company purchased $800 of supplies on account.
d. The company paid $600 cash for selling expenses.
e. The company received $6,000 cash for services provided.
f. The company paid $800 cash toward accounts payable.
g. The company paid $4,000 cash for equipment.

Answer 1

Answer and Explanation:

The Journal entries are shown below:-

a. Cash Dr, $5,900

  Equipment Dr, $6,900

 Web servers Dr, 12,900

              To D.Belle, Capital $25,700

(Being owner investment is recorded)

b. Prepaid Insurance Dr, $6,000

           To Cash 6,000

(Being payment made in advance for prepaid Insurance is recorded)

c. Supplies Dr, $800

            To Accounts payable 800

(Being purchase of supplies is recorded)

d. Selling expenses Dr, $600

           To Cash $600

(Being made for selling expenses is recorded)

e. Cash Dr, 6,000

           To Service revenue $6,000

(Being cash received from service provided is recorded)

f. Accounts payable Dr, $800

           To Cash $800

(Being accounts payable is recorded)

g. Equipment Dr, $4,000

               To Cash $4,000

(Being purchase of equipment is recorded)