The following information applies to the questions displayed below Nicole has de
ID: 2330905 • Letter: T
Question
The following information applies to the questions displayed below Nicole has decided that she is going to start her business, Nicole's Getaway Spa (NGS). A lot has to be done when starting a new business. Here are some transactions that have occurred prior to April 30. a. Received $93,000 cash when issuing 9,300 new common shares b. Purchased land by paying $6,000 cash and signing a note payable for $10,000 due in three years. c. Hired a new aesthetician for a salary of $2.300 a month, starting next month. d. NGS purchased a company car for $31,000 cash (list price of $34,000) to assist in running errands for the business e. Bought and received $800 in supplies for the spa on credit Paid $200 of the amount owed in (e). g. Nicole sold 100 of her own personal shares to Raea Gooding for $800.Explanation / Answer
S.No.
General Journal
Debit
Credit
a.
Cash
93000
Common Stock
93000
b.
Land
16000
Cash
6000
Notes Payable (Long Term)
10000
c.
No Journal Entry. Because this is an exchange of only promises, so it is not a transaction
d.
Equipment
31000
Cash
31000
e.
Supplies
800
Accounts Payable
800
f.
Accounts Payable
200
Cash
200
g.
No Transaction
Cash :-
Beg. Bal.
0
6000
b.
a.
93000
31000
d.
200
f.
End. Bal.
55800
Suppies:-
Beg. Bal.
0
e.
800
End. Bal.
800
Equipment:-
Beg. Bal.
0
d.
31000
End. Bal.
31000
Land:-
Beg. Bal.
0
b.
16000
End. Bal.
16000
Accounts Payable :-
Beg. Bal.
0
800
e.
f.
200
600
End. Bal.
Notes Payable (Long Term) :-
Beg. Bal.
0
10000
b.
10000
End. Bal.
Common Stock :-
Beg. Bal.
0
93000
a.
93000
End. Bal.
S.No.
General Journal
Debit
Credit
a.
Cash
93000
Common Stock
93000
b.
Land
16000
Cash
6000
Notes Payable (Long Term)
10000
c.
No Journal Entry. Because this is an exchange of only promises, so it is not a transaction
d.
Equipment
31000
Cash
31000
e.
Supplies
800
Accounts Payable
800
f.
Accounts Payable
200
Cash
200
g.
No Transaction
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