Journalize each transaction in the general journal referring to the following chart of accounts in selecting the accounts to be debited and credited and include a narration for each transaction:
For the past several years, Angela Smith operated a part-time consulting business from her home. As of September 1, 2020, Angela decided to move to rented quarters and to operate the business on a full-time basis. She has registered the business as Interactive Consulting Ltd but has no prior knowledge of accounting and has approached a member of your group for advice. The company entered the following transactions during September:
Sept 1. The following assets were received from Angela Smith in exchange for capital of Interactive Consulting Ltd: cash - $7,050, accounts receivable - $1,500, supplies - $1,250, and office equipment - $7,200. There were no liabilities received.
- Paid three (3) months rent on a lease rental contract, $3,600.
- Paid the premiums on the property and peril insurance policies, $1,500.
- Received cash from clients as an advance payment for services to be provided in the coming months, $3,500.
- Purchased additional office equipment on account from Payne Company, $1,800.
- Received cash from clients on account, $800.
- Paid cash for newspaper advertisement, $120.
- Paid Payne Company a portion of the debt incurred on September 5, $800.
- Recorded services provided on account for the period September 1 -12, $1,200.
- Paid part-time receptionist for two weeks’ salary, $400.
- Recorded cash from cash clients for fees earned during the first half of September, $2,100.
- Paid cash for supplies, $750.
- Recorded services provided on account for the period September 13-20, $1,100.
- Recorded cash from cash clients for fees earned for the period September 17-24, $1,850.
- Received cash from clients on account, $1,300.
- Paid part-time receptionist for two weeks salary, $400.
- Paid telephone bill for September, $130.
- Paid electricity bill for September, $200.
- Recorded cash from cash clients for fees earned for the period September 25-30, $1,050.
- Recorded services provided on account for the remainder of September, $500.
Requirement:
1. Journalize each transaction in the general journal referring to the following chart of accounts in selecting the accounts to be debited and credited and include a narration for each transaction:
|
Account # |
Account Name |
|
11 |
Cash |
|
12 |
Accounts Receivables |
|
14 |
Supplies |
|
15 |
Prepaid Rent |
|
16 |
Prepaid Insurance |
|
18 |
Office Equipment |
|
21 |
Accounts Payable |
|
22 |
Salaries Payable |
|
23 |
Unearned Fees |
|
31 |
Capital Stock |
|
41 |
Fees Earned |
|
51 |
Salary Expense |
|
52 |
Rent Expense |
|
53 |
Supplies Expense |
|
54 |
Insurance Expense |
|
55 |
Utilities Expense |
|
56 |
Advertising Expense |
2.
3. Prepare a
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