Chapter 2 HomeworkChegg Study Order Contlrmas X htm pter 2 Homework Help Save&Ex

Question

Chapter 2 HomeworkChegg Study Order Contlrmas X htm pter 2 Homework Help Save&Exl Check my The following transactions occurred uring March 208 tr te winwright Corporator. The company owns med operate·whole! 1 Issued 44,000 shares of common stock in exchange for $440,000 in cash 2. Purchased equipment at a cost of $68,000. $17000 cash was paid and a note payable was signed for the belance owed 3 Purchased Inventory on account at a cost of $134,000. The company uses the perpetual inventory system 4 Credit sales for the month totaled $190,000. The cost of the goods sold was $114,000. 5. Pald $6,000 in rent on the warehouse building for the month of March. 6. Paid $6.850 to an insurance company for fire and Sability Insurance for a one-year period beginning Apri 1,2018. 8. Collected $85,500 from customers on account. Raterences9. Recorded depreclation expense of $1700 for the month on the equipment Prepare journal entries to record each of the trensactions Isted above. of no entry ls required for a transactlon/ewent Journal entry required" In the first account field.) t, select "No Journal entry worksheet 9 10 Issued 44,000 shares of common stock in exchange for 1440,000 in cash. Prev f3 Next> 0 2

Explanation / Answer

the following are the journal entries:

(10 entries for 9 transactions as 4th transaction requires two entries).

(sno is of journal entry).

sno general journal debit credit 1 Cash a/c 440,000 .............To Common stock a/c 440,000 (since shares are issued for cash) 2 Equipment a/c 68,000 ..............To Cash a/c 17,000 ..............To notes payable a/c 51,000 3. Merchandise inventory a/c 134,000 ................To accounts payable a/c 134,000 4 Accounts receivable a/c 190,000 ................To Sales a/c 190,000 5 cost of goods sold a/c 114,000 .............To merchandise inventory a/c 114,000 6 Rent expense a/c 6,000 ..............To cash a/c 6,000 7 Prepaid insurance a/c 6,850 ..............To Cash a/c 6,850 (since insurance is for period beginning 1 April, whole of the amount will be prepaid insurance) 8 Accounts payable a/c 114,000 ...................To Cash a/c 114,000 9 Cash a/c 85,500 .................To Accounts receivable a/c 85,500 10 Depreciation expense -equipment a/c 1,700 ....................To accumulated depreciation - equipment a/c 1,700

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