8. The following events occurred during the month of May for McLain Company. a. McLain sells...

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8. The following events occurred during the month of May for McLain Company. a. McLain sells 240 units for $20 each. McLain collects cash for 200 of these units. The units cost McLain $8 each to purchase. b. McLain purchases $1,800 worth of inventory on account. c. McLain collects $500 in cash on its A/R. d. McLain takes out a loan for $400. e. McLain pays out $350 cash in dividends. f. McLain receives a contribution of $600 from its owners. g. McLain purchased a new piece of equipment. The new equipment cost $1,000 and was paid for in cash. h. McLain pays $500 of its accounts payable. i. McLain incurs $500 in salaries expense, but will no pay workers until next month. j. McLain incurs $300 in rent expense and pays it in cash. k. McLain prepays $200 in cash for insurance. 1. Taxes, paid in cash, are $110. Required: a. Prepare journal entries for the above transactions. b. Complete the T-accounts below. Numbers already under the accounts represent the prior balance in that account. Figure 4.30 Opening T-Account Balances Cash Accounts Receivable 200 Inventory 150 Prepaid Insurance Equipment 2,000 500 Accounts Payable Salary Payable Note Payable Capital Stock 1,500 600 Retained Earnings Sales Revenue Cost of Goods Sold Salary Expense 750 Rent Expense Tax Expense Dividends c. Prepare a trial balance for May. 8. The following events occurred during the month of May for McLain Company. a. McLain sells 240 units for $20 each. McLain collects cash for 200 of these units. The units cost McLain $8 each to purchase. b. McLain purchases $1,800 worth of inventory on account. c. McLain collects $500 in cash on its A/R. d. McLain takes out a loan for $400. e. McLain pays out $350 cash in dividends. f. McLain receives a contribution of $600 from its owners. g. McLain purchased a new piece of equipment. The new equipment cost $1,000 and was paid for in cash. h. McLain pays $500 of its accounts payable. i. McLain incurs $500 in salaries expense, but will no pay workers until next month. j. McLain incurs $300 in rent expense and pays it in cash. k. McLain prepays $200 in cash for insurance. 1. Taxes, paid in cash, are $110. Required: a. Prepare journal entries for the above transactions. b. Complete the T-accounts below. Numbers already under the accounts represent the prior balance in that account. Figure 4.30 Opening T-Account Balances Cash Accounts Receivable 200 Inventory 150 Prepaid Insurance Equipment 2,000 500 Accounts Payable Salary Payable Note Payable Capital Stock 1,500 600 Retained Earnings Sales Revenue Cost of Goods Sold Salary Expense 750 Rent Expense Tax Expense Dividends c. Prepare a trial balance for May.

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Solution Journal Entries Date Particulars Dr Cr a cash ac Dr 4000 Account Recievable ac ... View the full answer