SmartAutoTrader is an online company that specializes in matching buyers and sellers of used items. Buyers and sellers can purchase a membership with SmartAutoTrader, which provides them with advance notice of potentially attractive offers. The following transactions occurred during the company's most recent quarter:
a. SmartAutoTrader provided online advertising services for another company for $200 on account.
b. On the last day of the month, SmartAutoTrader paid $50 cash to run an advertise- ment promoting the company's services. The advertisement ran that day in the local newspaper.
c. Received $200 cash in membership fees for the month from new members.
d. Received an electricity bill for $85, for usage this month. The bill will be paid next month.
e. Billed a customer $180 for expediting the sale of some items. SmartAutoTrader expects to receive the customer's payment by the end of next month.
f. Received $4,000 in cash and cheques from membership sales.
g. Paid $2,000 cash for employee wages this month.
h. Paid $1,000 cash on a loan from the bank. (Ignore interest.)
i. Bought $3,000 worth of supplies from a large manufacturer, paying $1,000 cash and signing a short-term note for $2,000.
j. Signed a long-term note and received a $150,000 loan from a local bank.
k. Billed a customer $2,000 for services provided. Payment is expected in 45 days.
l. Wrote a cheque for $600 for rent.
m. Received $450 cash from a customer for work done the same day.
n. The company incurred $400 in advertising costs for the current month and is planning to pay these costs next month.
Required
For each of the transactions, prepare journal entries. Be sure to categorize each account as an asset (A), liability (L), shareholders' equity (SE), revenue (R), or expense (E).