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Gener Home Insert Page Layout Formulas Data Review ViewAdd-I Cut à Copy Clipboard Arial Paste Alignment Font Salary Expense 41 8 1 Requirement #1 2 During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation 3 completed the following transactions 5 July 1 Began business by making a deposit in a company bank account of $40,000, in exchange 8 July 3 o July 5 12 July 7 for 4,000 shares of $10 par value common stock Paid the current month's rent, $2,500 Paid the premium on a 1 year insurance policy. $3,600 Purchased supplies on account from Little Company, $700 13 14 July 10 Paid employee salaries, $2,800 6 July 14 Purchased equipment from Lake Company. $9,500. Paid $1,500 down and the balance was placed on account. Payments will be $500 00 per month for 20 months. The first payment is due 8/1. Note: Use accounts payable for the balance due July 15 Received cash for preparing tax returns for the first half of July. $6,500 July 19 Made payment on account to Lake Company, $500 July 31 Received cash for preparing tax returns for the last haltf of July, $8,250 6 July 31 Declared and paid cash dradends of $450 21 29 Prepare journal entries to record the July tra s in the General Journal below. General Jounal Cash Common Stock Rent Expense Cash edt 40.000 2,500 3,600 40 Genenl Ledger Balance Adjusted Tral Baance

Explanation / Answer

Debit Credit 1st July Cash $ 40,000.00 Common Stock $ 40,000.00 To Record Issue of Common Stock 3rd July Rent Expense $    2,500.00 Cash $    2,500.00 (To record Rent expenses Paid 5th July Prepaid Insurance $    3,600.00 Cash $    3,600.00 To record Payment for insurance 7th July Supply Purchase $        700.00 Accounts Payable $        700.00 To record Supply Purchase expense 10th July Salaries Expense $    2,800.00 Cash $    2,800.00 To record Payment of Salaries 14th July Equipment $    9,500.00 Accounts Payable $    8,000.00 cash $    1,500.00 To record equipment purchase 15th July Cash $    6,500.00 revenue $    6,500.00 To record receipt of cash 19th July Accounts Payable $        500.00 cash $        500.00 To record payment to supplier 31st July Cash $    8,250.00 revenue $    8,250.00 To record receipt of cash 31st July Dividend $        450.00 Cash $        450.00 Trail Balance Account Debit Credit Cash $ 43,400.00 Common Stock $ 40,000.00 Rent Expense $    2,500.00 Prepaid Insurance 3600 Supply Purchase $        700.00 Accounts Payable 8200 Salaries Expense $    2,800.00 Equipment $    9,500.00 Revenue $ 14,750.00 Dividend $        450.00 $ 62,950.00 $ 62,950.00 Adjusted entries Debit Credit Insurance 300 Prepaid Insurance 300 To record Adjustment of insurance expenses Supplies Expense 400 Supplies 400 Recoriding of supplies utilized Depreciation Expense Equipment 125 Accumulated Depreciation Equipment 125 To record Depreciation Income tax expense 2700 Income tax Payable 2700 Income tax payable created Adjusted trail Balance Trail Balance Debit Credit Cash 43400 Common Stock 40000 Rent Expense 2500 Prepaid Insurance 3300 Supply Purchase 300 Accounts Payable 8200 Salaries Expense 2800 Equipment 9500 Revenue 14750 Dividend 450 Supplies Expense 400 Depreciation Expense Equipment 125 Accumulated Depreciation Equipment 125 Income tax expense 2700 Income tax Payable 2700 Insurance 300 65775 65775

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