Question

Selected transactions for Ayayai Corp. during its first month in business are presented below.

Sept. 1 Issued common stock in exchange for $18,000 cash received from investors.
5 Purchased equipment for $8,500, paying $2,500 in cash and the balance on account.
8 Performed services on account for $18,000.
14 Paid salaries of $1,200.
25 Paid $2,500 cash on balance owed for equipment. 30 Paid $500 cash dividend.

Required:
Therow's chart of accounts shows Cash, Accounts Receivable, Equipment, Accounts Pay- able, Common Stock, Dividends, Service Revenue, and Salaries and Wages Expense.
a. Prepare a tabular analysis of the September transactions.
b. Journalize the transactions. Do not provide explanations.
c. Post the transactions to T-accounts.

Answer 1

Answer:

Sept 1. Cash (Dr.) $18,000

Common Stock (Cr.) $18,000

5. Equipment (Dr.) $8,500

Cash (Cr.) $2,500

Accounts Payable (Cr.) $5,000

8. Accounts Receivable (Dr.) $18,000

Service Revenue (Cr.) $18,000

14. Salaries Expense (Dr.) $1,200

Cash (Cr.) $1,200

25. Accounts Payable (Dr.) $2,500

Cash (Cr.) $2,500

30. Dividend Paid (Dr.) $500

Cash (Cr.) $500

Explanation:

T- Accounts:

Debits

Cash 11,800

Equipment 8,500

Accounts Receivable 18,000

Salaries Expense 1,200

Total 39,500

Credits

Service Revenue 18,000

Accounts Payable 2,500

Common Stock 18,000

Dividend Paid 500

Total 39,500