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QS 2-6 Analyzing transactions and preparing journal entries LO P1 On May 15, DeS

ID: 2538185 • Letter: Q

Question

QS 2-6 Analyzing transactions and preparing journal entries LO P1

On May 15, DeShawn Tyler opens a landscaping company called Elegant Lawns by investing $83,000 in cash along with equipment having a $43,000 value.

On May 21, Elegant Lawns purchases office supplies on credit for $540.

On May 25, Elegant Lawns receives $9,100 cash for performing landscaping services.

On May 30, Elegant Lawns receives $2,300 cash in advance of providing landscaping services to a customer.

For each transaction, (1) analyze the transaction using the accounting equation, (2) record the transaction in journal entry form, and (3) post the entry using T-accounts to represent ledger accounts. Use the following (partial) chart of accounts—account numbers in parentheses: Cash (101); Accounts Receivable (106); Office Supplies (124); Trucks (153); Equipment (167); Accounts Payable (201); Unearned Landscaping Revenue (236); D. Tyler, Capital (301); D. Tyler, Withdrawals (302); Landscaping Revenue (403); Wages Expense (601), and Landscaping Expense (696).

Cash 101 Office Supplies 124 ay 21 9,100 ay 21 540 End. bal. 9,100 End. bal. 540 Equipment 167 Accounts Payable 201 ay 15 43,000 ay 21 540 126,000 May 15 End. bal 83,000 End. bal 540 Unearned Landscaping Revenue 236 D. Tyler, Capital 301 23,000 May 25 End. bal. 23,000 End. bal. Landscaping Revenue 403 ay 25 91,000 End. bal 91,000

Explanation / Answer

Required T-accounts are as prepared below:

Cash 101 Particulars Amount Particulars Amount May-15 83,000 May-25 9,100 May-30 2,300 94,400 Office Supplies 124 Particulars Amount Particulars Amount May-21 540 540 Equipment 167 Particulars Amount Particulars Amount May-15 43,000 43,000 0 Accounts payable 201 Particulars Amount Particulars Amount May-21 540 540 Unearned Landscaping Revenue 236 Particulars Amount Particulars Amount May-30 2,300 2,300 D. Tayler Capital 301 Particulars Amount Particulars Amount May-15 126,000 126,000 landscaping Revenue 403 Particulars Amount Particulars Amount May-25 9,100 9,100
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