Answer:
a. See the explanation below for the journal entries.
b. each of the following accounts have an ending balance (in red color) after the recording as follows:
Cash, $27,000;
Common stock, $40,000;
Accounts payable, $4,000;
Accounts receivable, $3,000;
Equipment, $10,000.
However, each of the other accounts will have a zero ending balance.
Explanation:
a. Recording Transactions Using Journal Entries
The journal entries will look as follows:
<u>Accounts Name Dr ($) Cr ($) </u>
Cash 40,000
Common stock 40,000
<em><u>(To record cash receipts for common stock.) </u></em>
Inventory 4,000
Accounts payable 4,000
<em><u>(To record inventory purchase.) </u></em>
Account receivable 6,000
Sales 6,000
<em><u>(To record credit sales.) </u></em>
Cost of sales 4,000
Inventory 4,000
<em><u>(To record cost of sales.) </u></em>
Cash 3,000
Account receivable 3,000
<u><em>(To cash collected from credit sales.) </em></u>
Equipment 10,000
Note payable 10,000
<em><u>(To record purchase of equipment by issuing note.) </u></em>
Wages 2,000
Cash 2,000
<em><u>(To record wages paid in cash.) </u></em>
Note payable 10,000
Cash 10,000
<em><u>(To record note due paid.) </u></em>
Dividend 4,000
Cash 4,000
<em><u>(To record cash dividend paid.) </u></em>
b. Recording Transactions Using T-Accounts
Note: See the attached excel file for the T-Accounts.
From the attached excel file, each of the following accounts have an ending balance (in red color) after the recording as follows:
Cash, $27,000;
Common stock, $40,000;
Accounts payable, $4,000;
Accounts receivable, $3,000;
Equipment, $10,000.
However, each of the other accounts will have a no or zero ending balance.
