The following events apply to Pearson Service Co. for Year 1, its first year of operation: Received cash of $50,000 from the issue of common stock. Performed $90,000 worth of services on account. Paid $64,000 cash for salaries expense. Purchased supplies for $12,000 on account. Collected $78,000 of accounts receivable. Paid $8,500 of the accounts payable. Paid a $5,000 dividend to the stockholders. Had $1,500 of supplies on hand at the end of the period. Required Record these events in general journal form. Post the entries to T-accounts and determine the ending balance in each account. Determine the amount of total assets at the end of Year 1. Determine the amount of net income for Year 1.
The following events apply to Pearson Service Co. for Year 1, its first year of operation:
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Received cash of $50,000 from the issue of common stock.
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Performed $90,000 worth of services on account.
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Paid $64,000 cash for salaries expense.
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Purchased supplies for $12,000 on account.
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Collected $78,000 of
accounts receivable . -
Paid $8,500 of the accounts payable.
-
Paid a $5,000 dividend to the stockholders.
-
Had $1,500 of supplies on hand at the end of the period.
Required
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Record these events in general journal form.
-
Post the entries to T-accounts and determine the ending balance in each account. -
Determine the amount of total assets at the end of Year 1.
-
Determine the amount of net income for Year 1.
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