Answer:
1. Issued stock to investors for $14,310 in cash.
Dr Cash (asset account) 14,310 ⇒ account increases
Cr Common stock (equity account) 14,310 ⇒ account increases
2. Purchased used car for $10,330 cash for use in business.
Dr Vehicles (asset account) 10,330 ⇒ account increases
Cr Cash (asset account) 10,330 ⇒ account increases
3. Purchased supplies on account for $310.
Dr Supplies (asset account) 310 ⇒ account increases
Cr Accounts payable (liability account) 310 ⇒ account increases
4. Billed customers $4,880 for services performed.
Dr Accounts receivable (asset account) 4,880 ⇒ account increases
Cr Service revenue (revenue account) 4,880 ⇒ account increases
5. Paid $180 cash for advertising start of the business.
Dr Advertising expense (expense account) 180 ⇒ account increases
Cr Cash (asset account) 180 ⇒ account increases
6. Received $1,670 cash from customers billed in transaction (4).
Dr Cash (asset account) 1,670 ⇒ account increases
Cr Accounts receivable (asset account) 1,670 ⇒ account increases
7. Paid creditor $160 cash on account.
Dr Accounts payable (liability account) 160 ⇒ account increases
Cr Cash (asset account) 160 ⇒ account increases
8. Paid dividends of $550 cash to stockholders.
Dr Dividends (contra equity account) 550 ⇒ account increases, but total equity decreases
Cr Cash (asset account) 550 ⇒ account increases
T-accounts listed below:
cash
debit credit
1) 14,310
2) 10,330
5) 180
6) 1,670
7) 160
8) <u> 550</u>
4,760
vehicles common stock
debit credit debit credit
2) 10,330 1) 14,310
supplies accounts payable
debit credit debit credit
3) 310 3) 310
7) <u>160 </u>
150
accounts receivable service revenue
debit credit debit credit
4) 4,880 4) 4,880
6) <u> 1,670</u>
3,210
advertising expense dividends
debit credit debit credit
5) 180 8) 550
