Denzel Brooks opens a Web consulting business called Venture Consultants and completes the following transactions in March.
Question:
Denzel Brooks opens a Web consulting business called Venture Consultants and completes the following transactions in March.
March 1 Brooks invested $180,000 cash along with $30,000 of office equipment in the company in exchange for its common stock.
2 The company prepaid $8,000 cash for six months’ rent for an office. (Hint: Debit Prepaid Rent for $8,000.)
3 The company made credit purchases of office equipment for $3,300 and office supplies for $1,400. Payment is due within 10 days.
6 The company completed services for a client and immediately received $6,000 cash.
9 The company completed a $9,200 project for a client, who must pay within 30 days.
12 The company paid $4,700 cash to settle the account payable created on March 3.
19The company paid $7,500 cash for the premium on a 12-month insurance policy.
22 The company received $4,300 cash as partial payment for the work completed on March 9.
25 The company completed work for another client for $3,590 on credit.
29 The company paid $4,900 cash for dividends.
30 The company purchased $1,700 of additional office supplies on credit.
31 The company paid $500 cash for this month’s utility bill.
Required
1. Prepare general journal entries to record these transactions (use the account titles listed in part 2).
2. Open the following ledger accounts—their account numbers are in parentheses (use the balance column format): Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); Common Stock (307); Dividends (319); Services Revenue (403); and Utilities Expense (690). Post the journal entries from part 1 to the ledger accounts and enter the balance after each posting.
3. Prepare a trial balance as of the end of March.
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...
Step by Step Answer:
Part 1 Mar 1 Cash 101 180000 Office Equipment 163 30000 Common Stock 307 210000 Owner invested cash and equipment 2 Prepaid Rent 131 8000 Cash 101 800...View the full answer
