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Problem 2-1A Whispering Winds Corp. was started on April 1 by R. S. Francis and

ID: 2597401 • Letter: P

Question

Problem 2-1A

Whispering Winds Corp. was started on April 1 by R. S. Francis and associates. The following selected events and transactions occurred during April.


Whispering Winds uses the following accounts: Cash, Prepaid Insurance, Land, Accounts Payable, Unearned Service Revenue, Common Stock, Dividends, Service Revenue, Advertising Expense, and Salaries and Wages Expense.

Journalize the April transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

Apr. 1 Stockholders invested $50,300 cash in the business in exchange for common stock. 4 Purchased land costing $30,100 for cash. 8 Incurred advertising expense of $1,730 on account. 11 Paid salaries to employees $1,450. 12 Hired park manager at a salary of $3,700 per month, effective May 1. 13 Paid $1,240 cash for a one-year insurance policy. 17 Declared and paid a $1,040 cash dividend. 20 Received $6,600 in cash for admission fees. 25 Sold 126 coupon books for $46 each. Each book contains 10 coupons that entitle the holder to one admission to the park. 30 Received $9,700 in cash admission fees. 30 Paid $730 on balance owed for advertising incurred on April 8.

Explanation / Answer

Date Account Name Debit($) Credit($)

April 1 Cash A/c Dr. 50,300

To Common Stock A/c 50,300

(Being stockholders invested cash in business in exchange of common stock)

April 4 Land A/c Dr. 30,100

To Cash A/c 30,100

(Being land purchased in cash)

April 8 Advertising Expense A/c Dr. 1,730

To Accounts Payable A/c 1,730

(Being advertising expense incurred)

April 11 Salaries and wages expense A/c Dr. 1,450

To Cash A/c 1,450

(Being salary paid to employees)

April 12 No Entry

(Beacuse hiring a park manager on april 12 and salary is payable from

May 1, is just a event. No transaction takes place on April 12)

April 13 Prepaid Insurance A/c Dr. 1,240

To Cash A/c 1,240

(Being insurance paid in advance in cash)

April 17 Dividend A/c Dr. 1,040

To Cash A/c 1,040

(Being dividend paid)

April 20 Cash A/c Dr. 6,600

To Service Revenue A/c 6,600

(Being Cash received on acoount of admission fee)

April 25 Cash A/c Dr. (126 coupon books * 46 each) 5,796

To Unearned Service Revenue A/c 5,796

(Being cash received on sale of coupon books)

April 30 Cash A/c Dr. 9,700

To Service Revenue A/c 9,700

(Being Cash received on acoount of admission fee)

April 30 Accounts Payable A/c Dr. 730

To Cash A/c 730

(Being advertising expense paid incured on April 8)

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