Question

Oct. 1 Stockholders invest $33,540 in exchange for common stock of the corporation 2 Hires an administrative assistant at an annual salary of $41,520. 3 Buys office furniture for $3,690, on account. 6 Sells a house and lot for E. C. Roads; commissions due from Roads, $11,190 (not paid by Roads at this time) 10 Receives cash of $155 as commission for acting as rental agent renting an apartment. 27 Pays $660 on account for the office furniture purchased on October 3. 30 Pays the administrative assistant $3,460 in salary for October.
Journalize the transactions. (If no entry is required, select "No entry" for the account titles and enter 0 for the the problem.)
Date Account Titles and Explanation Debit Credit

Answer 1

Answer and Explanation:

The Journal entries are prepared below:-

1. Cash Dr, $33,540  

        To Common Stock $33,540

(Being the common stock issued is recorded)  

2. No journal entry is required as the agreement has been entered  

3. Office furniture Dr, $3,690  

           To Accounts payable $3,690

(Being the service revenue earned is recorded)  

4. Accounts receivable Dr, $11,190

          To Service revenue $11,190

(Being the service revenue earned is recorded)  

5. Cash Dr, $155

       To Service revenue $155

(Being the service revenue earned is recorded)  

6. Accounts Payable Dr, $660

       To Cash $660

(Being the payment of office furniture purchased is recorded)  

7. Salary expense Dr, $3,460

        To Cash $3,460

(Being the salaries paid to administrative staff is recorded)