Question

Rowland & Sons Air Transport Service, Inc., has been in operation for three years. The following transactions occurred in February:
Feb. 1 Paid $500 for rent of hangar space in February.
Feb. 4 Received customer payment of $1,510 to ship several items to Philadelphia next month.
Feb. 7 Flew cargo from Denver to Dallas; the customer paid in full ($1,410 cash).
Feb. 10 Incurred and paid $1,500 in pilot wages for flying in February.
Feb. 14 Paid $116 for an advertisement run in the local paper on February 14.
Feb. 18 Flew cargo for two customers from Dallas to Albuquerque for $2,130; one customer paid $860 cash and the other asked to be billed $1,270.
Feb. 25 Purchased on account $1,755 in supplies for future use on the planes.
Required:Prepare accrual basis journal entries for each transaction. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

Answer:

Entries are given below

Explanation:

Accrual basis journal entries for each transaction are given below according to their dates. As we all know expenses and assets are recorded on the debit side and liabilities and capital are recorded on the credit side.

Feb 1

                                               DEBIT                CREDIT

Rent expense                          500

Cash                                                                     500

Feb 4

                                               DEBIT                CREDIT

Cash                                       1510

Unearned Revenue                                            1510

Feb 7

                                               DEBIT                CREDIT

Cash                                        1410

Service Revenue                                                1410

Feb 10

                                               DEBIT                CREDIT

Wages                                    1500

Cash                                                                    1500

Feb 14

                                               DEBIT                CREDIT

Advertisement Expense         116

Cash                                                                     116

Feb 18

                                               DEBIT                CREDIT

Cash                                        860

Receivable                               1270

Service revenue                                                  2130

Feb 25

                                               DEBIT                CREDIT

Supplies                                  1755

Cash                                                                     1755