Question

Barbara Crusher is a licensed CPA. During the first month of operations of her business (a sole proprietorship), the following events and transactions occurred.

April

2 Invested $27,330 cash and equipment valued at $14,650 in the business.
2 Hired an administrative assistant at a salary of $338 per week payable monthly.
3 Purchased supplies on account $775. (Debit an asset account.)
7 Paid office rent of $590 for the month.
11 Completed a tax assignment and billed client $929 for services rendered. (Use Service Revenue account.)
12 Received $3,021 advance on a management consulting engagement.
17 Received cash of $2,535 for services completed for Ferengi Co.
21 Paid insurance expense $101.
30 Paid administrative assistant $1,352 for the month.
30 A count of supplies indicated that $138 of supplies had been used.
30 Purchased a new computer for $5,841 with personal funds. (The computer will be used exclusively for business purposes.)

Required:
Journalize the transactions in the general journal.

Answer 1

Solution :

Date       Account                                                           Debit($)           Credit($)

April 2     Cash                                                               27,330

               Equipment                                                      14,650

               Capital                                                                                      41,980

April 2     No journal is required on hiring employee

April 3     Supplies                                                         338

                Accounts payable                                                                    338

April 7     Rent expense                                                590

              Cash                                                                                            590

April 11   Accounts receivable                                       929

             Service revenue                                                                          929

April 12  Cash                                                                3021

             Unearned service revenue                                                        3021

April 17  Cash                                                                2535

             Service revenue                                                                         2535

April 21  Insurance expense                                        101

              Cash                                                                                             101

April 30   Salary expense                                             1352

               Cash                                                                                            1352

April 30  Supplies expense                                          138

              Cash                                                                                              138

April 30  Computer                                                        5841

              Capital                                                                                          5841