Answer:
1. Debit Cash $30,000
Credit Common stock $30,00
2. Debit Equipment $25,000
Credit Accounts payable $25,000
3. Debit Rent expense $2,000
Credit Cash $2,000
4. Debit Accounts receivable $15,000
Credit Service revenue $15,000
5. Debit Cash $3,000
Credit Service revenue $3,000
6. Debit Utilities expense $6,000
Credit Cash $6,000
7. Debit Accounts payable $25,000
Credit Cash $25,000
8. Debit Advertising expense $1,500
Credit Accrued expenses $1,500
9. Debit Cash $10,000
Credit Accounts receivable $10,000
Explanation:
1. An investment made by the stockholder will result to a debit in cash and credit to common stocks issued in the amount of $30,000.
2. An acquisition on account of equipment will result to a debit in equipment and credit to accounts payable account in the amount of $25,000
3. We recognize the rent expense by debiting it and credit cash that the company parted with in the amount of $2,000
4. We recognize the service rendered whether paid or not by debiting accounts receivable and credit to service revenue in the amount of $15,000
5. We debit cash for the amount we receive in lieu of the service rendered and then credit service revenue in the amount of $3,000
6. Utilities expense is debited in such transaction and credit cash for the amount we paid
7. We debit the accounts payable we recognize in the number 4 and credit cash for the amount we paid in the amount of $6,000
8. We recognize the advertising expense at the time it incurred whether paid or not.
9. We debit cash for the consideration we received and credit accounts receivable in the amount $10,000
