Daniels Company is owned and operated by Thomas Daniels. The following selected transactions were completed by Daniels
Question:
Daniels Company is owned and operated by Thomas Daniels. The following selected transactions were completed by Daniels Company during May:
1. | Received cash from owner as additional investment $55,000. |
2. | Paid creditors on account $7,000. |
3. | Billed customers for services on account, $2,565. |
4. | Received cash from customers on accounts $8,450. |
5. | Paid cash to owner for personal use, $2,500. |
6. | Received the utility bill $160, to be paid next month. |
Indicate the effect of each transaction on the accounting equation: | ||
1) | By Account type - (A)assets, (L)liabilities, (OE)owner’s equity, (R)revenue, and (E)expense | |
2) | Name of Account for the entry | |
3) | The amount by of the transaction. | |
4) | Indicate the direction of change in the account that is affected. |
Note: Each transaction has two entries.
Entry | Entry | |||||||
Acct Type (1) | Name of Acct (2) | Amount (3) | Increase or Decrease (4) | Acct Type (1) | Name of Acct (2) | Amount (3) | Increase or Decrease (4) | |
1 | ||||||||
2 | ||||||||
3 | ||||||||
4 | ||||||||
5 | ||||||||
6 |
The accountant for Franklin Company prepared the following list of account balances from the company’s records for the year ended December 31, 2011:
Fees Earned | $165,000 | Cash | $ 30,000 | ||
Accounts Receivable | 14,000 | Selling Expenses | 44,000 | ||
Equipment | 64,000 | Franklin, Capital | 27,000 | ||
Accounts Payable | 12,000 | Interest Income | 3,000 | ||
Salaries & Wages Expense | 40,000 | Prepaid Rent | 2,000 | ||
Income Taxes Payable | 5,000 | Income Taxes Expense | 18,000 | ||
Notes Payable | 20,000 | Rent Expense | 20,000 |
Corporate Financial Accounting
ISBN: 978-1133952411
12th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan E. Duchac