Question

Diana Mark is the president of ServicePro, Inc., a company that provides temporary employees for not-for-profit companies. ServicePro has been operating for five years; its revenues are increasing with each passing year. You have been hired to help Diana in analyzing the following transactions for the first two weeks of April:April 2 Purchased office supplies for $500 on account.April 5 Billed the local United Way office $3,000 for temporary services provided.April 8 Paid $250 for supplies purchased and recorded on account last period.April 8 Placed an advertisement in the local paper for $400 cash.April 9 Purchased new equipment for the office costing $2,300 cash.April 10 Paid employee wages of $1,200, which were incurred in April.April 11 Received $1,000 on account from the local United Way office billed on April 5.April 12 Purchased land as the site of a future office for $10,000. The land value was appraised as $11,000. Paid $2,000 down and signed a long-term note payable for the balance.April 13 Issued 2,000 additional shares of common stock for $40 per share in anticipation of building a new office.April 14 Billed Family & Children's Services $2,000 for services rendered this month.April 15 Received the April utilities bill for $300 to be paid next month.For each of the transactions, prepare journal entries. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)1.) Record the purchase of office supplies for $500 on account.2). Record the entry for billing the local United Way office $3,000 for temporary services provided. 3). Record the payment of $250 for supplies purchased and recorded on account last period.4). Record the entry for placing an advertisement in the local paper for $400 cash.5). Record the purchase of new equipment for the office costing $2,300 cash.6). Record the payment of employee wages of $1,200, which were incurred in April.7). Record the receipt of $1,000 on account from the local United Way office billed on April 5.8). Record the entry for purchase of land as the site of a future office for $10,000. The land value was appraised as $11,000. Paid $2,000 down and signed a long-term note payable for the balance.9). Record the issuance of 2,000 additional shares of stock for $40 per share in anticipation of building a new office.10). Record the entry for billing Family & Children’s Services $2,000 for services rendered this month.11). Record the receipt of the April utilities bill for $300 to be paid next month.

Answer 1

Answer:

See Explanation Section

Explanation:

Journal Entries:

April 2 Office Supplies Debit $500

Accounts Payable Credit $500

Purchase office supplies on account.

April 5 Accounts Receivable Debit $3,000

Service revenue Credit $3,000

Performed services on account

April 8 Accounts Payable Debit $250

Cash Credit $250

Paid for office supplies those bought previously on account.

April 8 Advertisement expense Debit $400

Cash Credit $400

Paid advertising expense for cash

April 9 Equipment Debit $2,300

Cash Credit $2,300

Purchase equipment for cash

April 10 Wages Expenses Debit $1,200

Cash Credit $1,200

Paid wage expenses for cash

April 11 Cash Debit $1,000

Accounts Receivable Credit $1,000

Collected cash from customers provided services earlier.

April 12 Land Debit $10,000

Cash Credit $2,000

Notes payable Credit $8,000

Purchase a land signing a notes and paying a down payment.

April 13 Office Building Debit $80,000

Common Stock Credit $80,000

Issued common stock for building an office

April 14 Accounts Receivable Debit $2,000

Service Revenues Credit $2,000

Performed services on account.

April 15 Utilities expense Debit $300

Utilities payable Credit $300

Received the unpaid utilities bill to be paid in the next month.