A B D E H K O Q R S U C 1 V 1 Score: F G ASSETS INCREASE: DEBIT DECREASE: CREDIT J LIABILITIES INCREASE: CREDIT DECREASE: DEBIT OWNER'S EQUITY INCREASE: CREDIT DECREASE: DEBIT 2. 3 HINT: Make ALL entries to the T-accts, not the trial balance. The trial balance is protected. 4 DR CR TRANSACTIONS--ANALYZE EACH ONE AND INSERT TH 5 101 CASH 201 ACCTS PAYABLE 301 COMMON STOCK 6 1 *Lavon Corporation issued 100,000 shares of $1.0 at par, receiving cash. (See footnote below) 7 8 2 The company purchased equipment costing $15,0 9 302 RET. EARNINGS 10 3 Supplies were purchased for $4,000, on account 104 ACCTS RECEIVABLE o 101 CASH 0 104 ACCTS RECEIVABLE 0 106 SUPPLIES 0 110 EQUIPMENT 0 112 ACC. DEPR. EQUIP. . . 0 201 ACCTS PAYABLE 0 301 COMMON STOCK 1 302 RET. EARNINGS 0 401 SERVICE REVENUE 0 501 RENT EXPENSE 0 503 ADVERT. EXPENSE 0 504 SALARY EXPENSE 0 509 DEPR. EXPENSE 0 510 SUPPLIES EXPENSE 0 TOTALS In Balance? DR=CR? 11 12 13 14 15 16 17 18 4 The company paid rent in the amount of $2,500 OPERATIONS 501 RENT EXPENSE 401 SERVICE REVENUE 5 Advertising was purchased on account, $3,000 6 Salaries were paid to employees in cash, S12.000 106 SUPPLIES 7 The company provided $18,000 of services: $6,00 the rest will be received in 30 days. 0 0 19 503 ADVERT. EXPENSE YES 20 21 8 The company paid $3,500 cash on account. 110 EQUIPMENT 9 The company received $5,000 cash from custome 22 23 24 504 SALARY EXPENSE 10 Depreciation was recorded in the amount of $1,5 25 112 ACC. DEPR. EQUIP. 11 Supplies were used up in the amount of $1,000 26 27 28 NOTE: In practice, the net income would be close 509 DEPR. EXPENSE 29 30 1 TACTS 302 RET. EARNINGS 3 Supplies were purchased for $4,000, on account. 104 ACCTS RECEIVABLE 4 The company paid rent in the amount of $2,500. OPERATIONS 501 RENT EXPENSE 401 SERVICE REVENUE 5 Advertising was purchased on account, $3,000. 6 Salaries were paid to employees in cash. $12,000. 106 SUPPLIES 0 0 10 0 201 ACCTS PAYABLE 11 0 301 COMMON STOCK 12 1 302 RET. EARNINGS 13 0 401 SERVICE REVENUE 14 0 501 RENT EXPENSE 15 0 503 ADVERT. EXPENSE 16 0 504 SALARY EXPENSE 17 0 509 DEPR. EXPENSE 18 0 510 SUPPLIES EXPENSE 19 0 TOTALS 20 In Balance? DR=CR? 21 22 23 24 25 26 27 28 29 7 The company provided $18,000 of services: $6,00 the rest will be received in 30 days. YES 503 ADVERT. EXPENSE 8 The company paid $3,500 cash on account. 110 EQUIPMENT 9 The company received $5,000 cash from custome 504 SALARY EXPENSE 10 Depreciation was recorded in the amount of $1,5 112 ACC. DEPR. EQUIP. 11 Supplies were used up in the amount of $1.000. 509 DEPR. EXPENSE NOTE: In practice, the net income would be closes Retained Earnings. But for this exercise, leave Earnings empty 30 31 32 33 * A corporation issued shares of stock to investor were issued, and the price per share was $1.00 Here's the entry: 510 SUPPLIES EXPENSE 34 100,000 35 36 37 38 39 CASH COMMON STOCK 100,000 OWNER'S EQUITY INCREASE: CREDIT DECREASE: DEBIT TRANSACTIONS--ANALYZE EACH ONE AND INSERT THE ENTRIES. E 301 COMMON STOCK 1 *Lavon Corporation issued 100,000 shares of $1.00 par common stock at par, receiving cash. (See footnote below) 2 The company purchased equipment costing $15,000, paying cash. 302 RET. EARNINGS 3 Supplies were purchased for $4,000, on account. 4 The company paid rent in the amount of $2,500. OPERATIONS 501 RENT EXPENSE 401 SERVICE REVENUE 5 Advertising was purchased on account, $3,000. 6 Salaries were paid to employees in cash, $12,000. 7 The company provided $18,000 of services; $6,000 was received in cash and the rest will be received in 30 days. 503 ADVERT. EXPENSE 8 The company paid $3,500 cash on account. 9 The company received $5,000 cash from customers, on account. 504 SALARY EXPENSE 10 Depreciation was recorded in the amount of $1,500. (Adj.) 11 Supplies were used up in the amount of $1,000. (Adj.) NOTE: In practice, the net income would be closed to 509 DEPR. EXPENSE 4 + 100% u, on account. 4 The company paid rent in the amount of $2,500. OPERATIONS 501 RENT EXPENSE 401 SERVICE REVENUE 5 Advertising was purchased on account, $3,000. 6 Salaries were paid to employees in cash, $12,000. 7 The company provided $18,000 of services; $6,000 was received in cash and the rest will be received in 30 days. 503 ADVERT. EXPENSE 8 The company paid $3,500 cash on account. 9 The company received $5,000 cash from customers, on account. 504 SALARY EXPENSE 10 Depreciation was recorded in the amount of $1,500. (Adj.) 11 Supplies were used up in the amount of $1,000. (Adj.) 509 DEPR. EXPENSE NOTE: In practice, the net income would be closed to Retained Earnings. But, for this exercise, leave Retained Earnings empty. * A corporation issued shares of stock to investors. In this example, 100,000 shares were issued, and the price per share was $1.00. Cash goes up and Common Stock goes up. Here's the entry: 510 SUPPLIES EXPENSE 100,000 CASH COMMON STOCK 100,000