The Complete Accounting Cycle Without a Work Sheet: Two Months (second month opt

Question

The Complete Accounting Cycle Without a Work Sheet: Two Months (second month optional) On June 1, 2014, Bob Lutz opened Lutz Repair Service. During the month, he completed the following transactions for the company: June1Began business by depositing $20,000 in a bank account in the name of the company. 1Paid the rent for the store for current month, $1,700. 1Paid the premium on a one-year insurance policy, $1,920. 2Purchased repair equipment from Bilbao Company, $16,800. Terms were $2,400 down and $1,200 per month for one year. First payment is due June 1. 5Purchased repair supplies from Rusin Company on credit, $1,872. 8Paid cash for an advertisement in a local newspaper, $240. 15Received cash repair revenue for the first half of the month, $1,600. 21Paid Rusin Company on account, $900. 30Received cash repair revenue for the last half of May, $3,900. 30Made a withdrawal, $1,200. Hide 1. Prepare journal entries to record the June transactions. Include the Post. Ref. column and fill in using the account numbers listed in requirement 2. Enter the transactions in chronological order. For a compound transaction, if no entry is required, leave the box blank

Explanation / Answer

Date Account Title Debit Credit June 1 2014 Cash 20,000 Owner's equity 20,000 Prepaid rent 1,700 Cash 1,700 Prepaid insurance 1,920 Cash 1,920 Equipment 16,800 Cash 2,400 Bilbao Company 14,400 Bilbao Company 1,200 Cash 1,200 Supplies 1,872 Accounts payable 1,872 Advertisement expense 240 Cash 240 Cash 1,600 Revenue from services 1,600 Account payable 900 Cash 900 Cash 3,900 Revenue from services 3,900 Drawings 1,200 Cash 1,200

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