Julie Jones decided to open her own dry cleaning shop, Prestige Dry Cleaners, Inc. The following transactions are the events
Julie Jones decided to open her own dry cleaning shop, Prestige Dry Cleaners, Inc. The following transactions are the events that occurred during
April 2013, the company’s first month:
April 1 Julie contributed $45,000 cash in exchange for common stock. She also signed a note with 1st Regional Bank for $30,000.
3 The company rented a store at a shopping center and paid $14,400 prepaid rent for the first year.
10 The company purchased dry cleaning equipment on account for $21,250.
19 The company purchased insurance for three years with $5,400 cash. The policy was effective May 1.
21 Part of the equipment purchased on April 10 was damaged. The supplier agreed to remove $3,150 from Prestige Dry Cleaners’ account.
24 The company purchased furniture for $6,000 for Julie’s office on account.
27 The company paid off the balance owed on the equipment.
30 Three employees were hired at a rate of $56 a day each. Their start date is May 1.
Give the journal entry for each transaction. Set up the required T-accounts and post the entries to these accounts. Prepare an unadjusted trial balance.
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