Managerial Accounting
Managerial Accounting
7th Edition
ISBN: 9781260247886
Author: Wild
Publisher: MCG
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Chapter D, Problem 2PSB
To determine

(1)

General journal refers to the entry for each transaction in the books of accounts using the debit and credit method. In the double entry system, each transaction is recorded twice, one account is debited, whereas, the other is credited.

To prepare the journal entries.

Expert Solution
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Explanation of Solution

Journal Entries:

Date Particular PR Debit ($) Credit ($)
A Cash
Office equipment
computer equipment
Common stock
(To receive the investment by exchange the common stock)
101
163
164
307
65000
5750
30000
100750
B Land
Cash
Note payable
(To record the land purchase by cash and issue notes payable)
172
101
250
22000 5000
17000
C Building
Cash
(To record the purchase building)
170
101
34500 34500
D Prepaid insurance
Cash
(To record the prepaid insurance in advance)
108
101
5000 5000
E Cash
Account Receivable
(To record the cash from the account receivable
101
106
4600 4600
F Computer equipment
Cash
Notes payable
(To record the purchase the drafting equipment)
164
101
250
4500 800
3700
G Accounts receivable
Fees earned
(To record the accounts receivable)
106
402
4250 4250
H Office equipment
Account payable
163
201
950 950
I Accounts receivable
Fees earned
(The company sale service in the credit basis)
106
402
10200 10200
J Computer rent expense
Accounts payable
(To the rent expense)
602
201
580 580
K Cash
Accounts receivable
(To record the money received from the old customer)
101
106
5100 5100
I Wages
Cash
(To record the wages payment)
601
101
1800 1800
m. Accounts payable
Cash
(To record the cash paid to accounts payable)
201
101
950 950
N Computer Repair expense
Cash
(To record the repair expense)
604
101
608 608
O Dividend
Cash
(To record the dividend payment)
319
101
6230 6230
P Wages
Cash
(To record the wages payment)
601
101
1800 1800
Q Advertising expense
cash
(To record the Advertising payment)
603
101
750 750

All transaction should be recorded as per the explanation.

In the Journal entry, each transaction is recorded twice, one account is debited, whereas, the other is credited.

To determine

(2)

Ledger is a book of financial statement. All types of journal entries are classified in these books. Ledger shows the accumulated transaction of a related item.

To prepare: The ledger accounts.

Expert Solution
Check Mark

Explanation of Solution

The ledger account

Cash Accounts no. 101

Date PR Debit Credit Balance
A 307 65000 65000
B 172 5000 60000
C 170 34500 25500
D 108 5000 20500
E 106 4600 25100
F 164 800 24300
K 106 5100 29400
I 601 1800 27600
M 201 950 26650
N 604 608 26042
O 319 6230 19812
P 601 1800 18012
Q 603 750 17262

Office Equipment Accounts no. 163

Date PR Debit Credit Balance
A 307 5750 5750
H 201 950 6700

Computer Equipment  Accounts no. 164

Date PR Debit Credit Balance
A 307 5750 5750
F 101
250
800
3700
10250

Common stock Accounts no. 307

Date PR Debit Credit Balance
A 101 65000
A 163 5750
A 164 30,000 100750

Land Accounts no. 172

Date PR Debit Credit Balance
B 101 5000
B 250 17000 22000

Notes payable Accounts no. 250

Date PR Debit Credit Balance
B 172 17000 17000
F 164 3700 20700

Building Accounts no. 170

Date PR Debit Credit Balance
B 101 34500 34500

Prepaid insurance  Accounts no. 108

Date PR Debit Credit Balance
D 101 5000 5000

Account Receivable Accounts no. 106

Date PR Debit Credit Balance
E 101 4600 -4600
G 402 4250 -350
I 402 10200 9850
K 101 5100 4750

Accounts payable  Accounts no.201

Date PR Debit Credit Balance
H 163 950 950
J 602 580 1530
M 101 950 580

Fees earned Accounts no. 402

Date PR Debit Credit Balance
G 106 4250 4250
I 106 10200 14450

Computer rent expense  Accounts no. 602

Date PR Debit Credit Balance
J 201 580 580

Wages Accounts no. 601

Date PR Debit Credit Balance
I 101 1800 1800
P 101 1800 3600

Computer Repair Expense

Accounts no. 604

Date PR Debit Credit Balance
N 101 608 608

Dividend

 Accounts no. 319

Date PR Debit Credit Balance
O 101 6230 6230

Advertising expense Accounts no. 603

Date PR Debit Credit Balance
Q 101 750 750

In the ledger book, each transaction should be recorded separately.

A separate column should be prepared.

To determine

(3)

A trial balance is a list of ledger accounts.

Trial balance statements show the end balance of each ledger. They have two columns; one is debited and the other is credited.

To prepare: The Trial balance.

Expert Solution
Check Mark

Explanation of Solution

Trial balance:

Particular Number Debit Credit
Cash 101 17262
Office equipment 163 56700
Computer equipment 164 10250
Common stock 307 100750
Land 172 22000
Notes payable 250 20700
Building 170 34500
Prepaid insurance 108 5000
Account Receivable 106 4750
Account payable 201 580
Fees earned 402 14450
Computer rent expense 602 580
Wages 601 3600
Computer Repair expense 604 608
Dividend 319 6230
Advertising expense 603 750
Total 136480 136480

There are three types of trail balance:

  1. Unadjusted trail balance
  2. Adjusted trail balance
  3. Closing trial balance.

The abovementioned trial balance is the unadjusted trial balance, because no transaction has been adjusted in it.

This is a simple trial balance which shows the list of accounts with amount.

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Chapter D Solutions

Managerial Accounting

Ch. D - Prob. 11DQCh. D - Prob. 12DQCh. D - Prob. 13DQCh. D - Define (a) assets, (b) liabilities, and (c) equityCh. D - Prob. 15DQCh. D - Review the Apple balance sheet Appendix A....Ch. D - Review the Google balance sheet in Appendix A....Ch. D - Prob. 18DQCh. D - Identify the items from the following list that...Ch. D - Prob. 2QSCh. D - Prob. 3QSCh. D - Identify the normal balance (debit or credit) for...Ch. D - Prob. 5QSCh. D - Prob. 6QSCh. D - Prob. 7QSCh. D - A trial balance has total debits of $20,000 and...Ch. D - Prob. 9QSCh. D - Prob. 10QSCh. D - Prob. 11QSCh. D - Prob. 12QSCh. D - Prob. 13QSCh. D - Prob. 14QSCh. D - Prob. 15QSCh. D - Order the following steps in the accounting...Ch. D - Prob. 2ECh. D - Enter the number for the item that best completes...Ch. D - For each of the following, (1) identify the type...Ch. D - Prob. 5ECh. D - Prob. 6ECh. D - Prepare general journal entries for the following...Ch. D - Prob. 8ECh. D - Prob. 9ECh. D - Prob. 10ECh. D - Prob. 11ECh. D - 1. Prepare general journal entries for the...Ch. D - Prob. 13ECh. D - Prob. 14ECh. D - A corporation had the following assets and...Ch. D - Carmen Camry operates a consulting firm called...Ch. D - Prob. 17ECh. D - Prob. 18ECh. D - Prob. 19ECh. D - Prob. 20ECh. D - You are told the column totals in a trial balance...Ch. D - Exercise D-22 Calculating and interprets the debt...Ch. D - Prob. 23ECh. D - Prob. 1PSACh. D - Prob. 2PSACh. D - Denzel Brooks opened a web consulting business...Ch. D - Prob. 4PSACh. D - The accounting records of Nettle Distribution show...Ch. D - Prob. 6PSACh. D - Prob. 7PSACh. D - Prob. 1PSBCh. D - Prob. 2PSBCh. D - Prob. 3PSBCh. D - Prob. 4PSBCh. D - Prob. 5PSBCh. D - Prob. 6PSBCh. D - Prob. 7PSBCh. D - Prob. 1SPCh. D - Prob. 2SPCh. D - Prob. 3SPCh. D - Prob. 1GLPCh. D - Prob. 2GLPCh. D - Prob. 3GLPCh. D - Prob. 4GLPCh. D - Prob. 5GLPCh. D - Prob. 6GLPCh. D - Prob. 7GLPCh. D - Using transactions from the following assignments...Ch. D - Prob. 1AACh. D - Prob. 2AACh. D - Prob. 3AACh. D - Prob. 1BTNCh. D - Prob. 2BTNCh. D - Prob. 3BTNCh. D - The expanded accounting equation consists of...Ch. D - Prob. 5BTNCh. D - Prob. 6BTNCh. D - Prob. 7BTN
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