222. Journalize the following selected transactions for April 2011 in a two-column journal. Journal entry explanations may be omitted.
April 1
Received cash for capital stock, $14,000.
2
Received cash for providing accounting services, $9,500.
3
Billed customers on account for providing services, $4,200.
4
Paid advertising expense, $700.
5
Received cash from customers on account, $2,500.
6
Paid cash dividends, $1,000.
7
Received telephone bill, $900.
8
Paid telephone bill, $900.
Date
Description
Post. Ref.
Debit
Credit
223. Analyze the following transactions as to their effect on the accounting equation.
(a)
The company paid $725 to a vendor for supplies purchased previously on account.
(b)
The company performed $850 of services and billed the customer.
(c)
The company received a utility bill for $395 and will pay it next month.
(d)
The stockholder of the company received a cash dividend of $1,000.
(e)
The company paid $315 in salaries to its employees.
(f)
The company collected $730 of cash from its customers on account.
Some of the possible effects of a transaction on the accounting equation are listed below:
(1)
Asset, dr.; Asset, cr.
(2)
Liability, dr.; Revenue, cr.
(3)
Asset, dr.; Liability, cr.
(4)
Asset, dr.; Revenue, cr.
(5)
Liability, dr.; Assets, cr.
(6)
Equity, dr.; Asset, cr.
(7)
Expense, dr.; Assets, cr.
(8)
Expense, dr.; Liability, cr.
Put the appropriate letter next to each transaction.
224. Set up T accounts for Cash, Accounts Receivable, Supplies, Accounts Payable, Capital Stock, Dividends, Professional Fees, and Operating Expenses.
(a)
In the T accounts, record the following transactions of Potter Pool Services for June, 2011, identifying each entry by number:
(1)
Dan Potter invested $12,500 cash in the business in exchange for stock.
(2)
Purchased supplies on account, $6,250.
(3)
Paid operating expenses, $5,500.
(4)
Billed clients for fees, $7,440.
(5)
Received cash from cash clients, $4,700.
(6)
Paid creditors on account, $1,400.
(7)
Received $3,100 from clients on account.
(8)
The company paid Dan $1,500 in cash dividends.
(b)
Prepare a trial balance as of June 30, 2011 for Potter Pool Services.
(c)
Assuming that supplies expense (which has not been recorded) amounts to $1,500 for June, determine net income for the month.
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