Answer and Explanation:
The Journal entry is shown below:-
1. Cash Dr, $40,000
To Common stock $2,000
To Additional paid in capital $38,000
(Being issue of common stock is recorded)
2. Accounts receivables Dr, $18,800
To Service revenue $18,800
(Being service revenue is recorded)
3. Supplies Dr, $6,500
To Accounts payable $6,500
(Being supplies is recorded)
4. Treasury stock Dr, $20,900
[1,100 × $19]
To Cash $20,900
(Being treasury stock is recorded)
5, Accounts payable Dr, $18,100
To Cash $18,100
(Being cash paid is recorded)
6. Cash Dr, $50,700
To Service revenue $50,700
(Being cash received is recorded)
7. Cash Dr, $18,200
To Accounts receivables $18,200
(Being cash received is recorded)
8. Dividends Dr, $3,380
(16,000 + 2000 - 1,100) × $0.20
To dividends payable $3,380
(Being dividends declared is recorded)
9. Cash Dr, $14,700
[700 × $21]
To Treasury stock $13,300
[700 × $19]
To Additional paid in capital $1,400
(Being cash is recorded)
10. Salaries expense Dr, $43,600
To cash $43,600
(Being salary expenses is recorded)
11. Utilities expense Dr, $7800
To utilities payable $7800
(Being utilities expense is recorded)
12. Supplies expense Dr, $8,900
[$9,100 + $6,500 - $6,700]
To supplies $8,900
(Being supplies expenses is recorded)
13. Depreciation expense Dr, $1,900
[$80,000 - $11,600] ÷ 3 × 1 ÷ 12
To Accumulated depreciation $1,900
(Being depreciation expense is recorded)
14. Income tax expense $2,700
To Income tax payable $2,700
(Being income tax expenses is recorded)
