FINANCIAL ACCOUNTING REQUIRED JOURNAL ENTRY PROBLEM

Kelly Luwin started a software development business as a sole proprietorship DBA Kellco on 1 /1/XX. During the month of January, the company had the following transactions:

1/1 The owner invested $80,000 cash into the business checking account. In addition, she obtained a business credit card from the same bank.

1/2 Office space was rented for $2,800 per month and one

month's rent was paid in cash. In addition, $2,800 in cash was paid as a security deposit on the office space.

1/3 A phone system was purchased for $1,500 and installed. The

firm received an invoice from the company that installed the

system for the full amount due and payable on 1/31.

1/4 A computer server system was purchased for $15,000. $3,000 was paid in

cash and a 120-day note with an interest rate of 8% per annum was

signed for the balance owed.

1/7 Sent a bill to a client for $5,000 for software development that had been completed. The terms for payment were due on receipt.

1/10 A contract to develop software for a client in the amount of $20,000 was

entered into by Kellco. Kellco received $5,000 in cash as a prepayment.

1/15 Purchased office supplies in the amount of $325 using the firm's business credit card as payment.

1/18 Kellco issued a purchase order to buy office furniture in the amount of

$7,500.

1/20 Paid an accountant by check $1,500 to set up an accounting system.

1/25 Issued a check to P.G. & E in the amount of $300 to pay for

the owners personal utility bill.

1/28 Collected $5,000 from the 1/7 transaction.

1/31 Paid the bill received on 1/3

1/31 Received a credit card bill for the purchase on 1/15.

Required: Make the necessary journal entries from the information given. Omit the journal descriptions.