Answer:
Pioneer Designs
Journal Entries:
Date Account Titles Debit Credit
Oct. 1 11 Cash $32,800
31 Common Stock $32,800
To record the transfer of cash for common stock.
Oct. 4 53 Rent Expense $3,180
11 Cash $3,180
To record the payment of October rent.
Oct. 10 18 Truck $27,000
11 Cash $3,000
21 Notes Payable $24,000
To record the purchase of truck for cash and with a note for the remainder.
Oct. 13 16 Equipment $12,790
22 Accounts Payable $12,790
To record the purchase of equipment on account.
Oct. 14 13 Supplies $2,200
11 Cash $2,200
To record the purchase of supplies for cash.
Oct. 15 14 Prepaid Insurance $4,920
11 Cash $4,920
To record the prepayment of annual insurance premium.
Oct. 15 11 Cash $13,780
41 Fees Earned $13,780
To record the receipt of cash for job completed.
Page 2:
Oct. 21 22 Accounts Payable $4,560
11 Cash $4,560
To record the part-payment on account.
Oct. 24 12 Accounts Receivable $15,680
41 Fees Earned $15,680
To record the jobs completed and billed to customers.
Oct. 26 55 Truck Expense $1,440
22 Accounts Payable $1,440
To record the receipt of invoice for truck expenses.
Oct. 27 54 Utilities Expense $1,640
11 Cash $1,640
To record the payment of utilities expense.
Oct 27 59 Miscellaneous Expense $590
11 Cash $590
To record the payment of miscellaneous expense.
Oct. 29 11 Cash $6,560
12 Accounts Receivable $6,560
To record the receipt of cash from customers on account.
Oct. 30 51 Wages Expense $4,360
11 Cash $4,360
To record the payment of wages.
Oct. 31 33 Dividends $3,640
11 Cash $3,640
To record the payment of dividends to stockholders.
Explanation:
a) Data and Calculations:
Chart of accounts:
11 Cash
12 Accounts Receivable
13 Supplies
14 Prepaid Insurance
16 Equipment
18 Truck
21 Notes Payable
22 Accounts Payable
31 Common Stock
33 Dividends
41 Fees Earned
51 Wages Expense
53 Rent Expense
54 Utilities Expense
55 Truck Expense
59 Miscellaneous Expense
b) Journal entries are used to record business transactions as they occur on a daily basis. They show the accounts involved in each transaction and the ones to be debited and the ones to be credited as the case may be.
