Question

Transactions for the Sheldon Cooper Company, which provides welding services for the month of June are presented below. Identify the accounts to be debited and cred ited for each transaction. June 1 Sheldon Cooper invests $4,000 cash in exchange for shares of common stock in a small welding business. 2 Purchases equipment on account for $1,200. 3 $800 cash is paid to landlord for June rent. 12 Bills P. Leonard $300 for welding work done on account. BE2-3 Using the data in BE2-2, journalize the transactions. (You may omit explanations

Answer 1

Answer:

June 01: Invest cash for stock

Debited - cash

Credited - common stock capital

June 02: Equipment purchased on account

Debited - Equipment

Credited - Accounts Payable

June 03: paid rent

Debited - Rent expense

Credited - Cash account

June 13; Work done on account

Debited - Accounts receivable

Credited - Service revenue

The Journal entries are as follows:

On June 1,

Cash account A/c Dr. $4,000

    To common stock capital     $4,000

(To record the Invest cash for stock)

On June 2,

Equipment A/c Dr. $1,200

    To Accounts Payable      $1,200

(To record the Equipment purchased on account)

On June 3,

Rent expense A/c   Dr. $800

      To Cash account            $800

(To record the rent paid)

On June 12,

Accounts receivable A/c Dr. $300

       To  Service revenue                $300

(To record the work done on account)