Question

On april 1, Windsor, Inc. began operations. The following transactions were completed during the month.

1. Issued common stock for $28,300 cash.
2. Obtained a bank loan for $8,300 by issuing a note payable.
3. Paid $13,000 cash to buy equipment.
4. Paid $1,400 cash for April office rent.
5. Paid $1,700 for supplies.
6. Purchased $710 of advertising in the Daily Herald, on account.
7. Performed services for $21,200: cash of $2,360 was received from customers, and the balance of $18,840 was billed to customers on account.
8. Paid $470 cash dividend to stockholders.
9. Paid the utility bill for the month, $2,360.
10. Paid Daily Herald the amount due in transaction (6).
11. Paid $50 of interest on the bank loan obtained in transaction (2).
12. Paid employees’ salaries, $7,550.
13. Received $14,160 cash from customers billed in transaction (7).
14. Paid income tax, $1,770.

Required:
Journalise the transactions.

Answer 1

S/n General Journal Debit Credit

1. Cash $28,300

Common stock $28,300

(To record issuance of common stock)

2. Cash $8,300

Note payable $8,300

(To record issuance of note payable)

3. Equipment $13,000

Cash $13,000

(To record purchase of equipment)

4. Rent expense $1,400

Cash $1,400

(To record rent expense)

5. Supplies $1,700

Cash $1,700

(To record purchase supplies )

6. Advertising expense $710

Accounts payable $710

(To record advertising expense)

7. Cash $2,360

Accounts receivable $18,840

Service revenue $21,200

(To record service revenue)

8. Cash dividends $470

Cash $470

(To record cash paid for dividends )

9. Utilities expense $2,360

Cash $2,360

(To record utilities expense)

10. Accounts payable $710

Cash $710

(To record payment to creditors)

11. Interest expense $50

Cash $50

(To record interest expense)

12. Salaries and wages $7,550

expense

Cash $7,550

(To record salaries and wages expense)

13. Cash $14,160

Accounts receivable $14,160

(To record amount received from customers)

14. Tax Expenses $1,770

Account payable $1,770

(To record income tax expenses)