WHAT IS THE INCOME STATEMENT FOR THE FOLLOWING During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation, completed the following transactions. July 1 Began business by making a deposit in a company bank account of $60,000, in exchange for 6,000 shares of $10 par value common stock. July 3 Paid the current month's rent, $3,500 July 5 Paid the premium on a 1-year insurance policy, $4,200 July 7 Purchased supplies on account from Little Company, $1,000. July 10 Paid employee salaries, $3,500 July 14 Purchased equipment from Lake Company, $10,000. Paid $2,500 down and the balance was placed on account. Payments will be $500.00 per month until the equipment is paid. The first payment is due 8/1. Note: Use accounts payable for the balance due. July 15 Received cash for preparing tax returns for the first half of July, $8,000 July 19 Made payment on account to Lake Company, $500. July 31 Received cash for preparing tax returns for the last half of July, $9,000 July 31 Declared and paid cash dividends of $600.

WHAT IS THE INCOME STATEMENT FOR THE FOLLOWING

During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation,
completed the following transactions.

July 1 Began business by making a deposit in a company bank account of $60,000, in exchange
for 6,000 shares of $10 par value common stock.

July 3 Paid the current month's rent, $3,500

July 5 Paid the premium on a 1-year insurance policy, $4,200

July 7 Purchased supplies on account from Little Company, $1,000.

July 10 Paid employee salaries, $3,500

July 14 Purchased equipment from Lake Company, $10,000. Paid $2,500 down and the balance was
placed on account. Payments will be $500.00 per month until the equipment is paid. The first payment is due 8/1.
Note: Use accounts payable for the balance due.

July 15 Received cash for preparing tax returns for the first half of July, $8,000

July 19 Made payment on account to Lake Company, $500.

July 31 Received cash for preparing tax returns for the last half of July, $9,000

July 31 Declared and paid cash dividends of $600.


Prepare journal entries to record the July transactions in the General Journal below. Use the following account names for journal entries.

General Journal Chart of Accounts: Account Title (Normal Balance)
Date Description(Account Name) Debit Credit
Assets
Cash (Debit)
Prepaid Insurance (Debit)
Supplies (Debit)
Equipment (Debit)
Accumulated Depreciation - Equipment (Credit)

Liabilities
Accounts Payable (Credit)
Income Tax Payable (Credit)

Stockholders' Equity
Common Stock (Credit)
Retained Earnings (Credit)
Dividends (Debit)

Revenue
Tax Preparation Revenue (Credit)

Expenses
Rent Expense (Debit)
Salaries Expense (Debit)
Insurance Expense (Debit)
Supplies Expense (Debit)
Depreciation Expense (Debit)
Income Tax Expense (Debit)

Clearning Account
Income Summary