Question

Journalize the following business transactions in general journal form. Identify each transaction by number. You may omit explanations of the transaction. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
1. Stockholders invest $40,000 in cash in starting a real estate office operating as a corporation.
2. Purchased $500 of supplies on credit.
3. Purchased equipment for $25,000, paying $3,500 in cash and signed a 30-day, $21,500, note payable.
4. Real estate commissions billed to clients amount to $4,000.
5. Paid $700 in cash for the current month's rent.
6. Paid $250 cash on account for office supplies purchased in transaction 2.
7. Received a bill for $800 for advertising for the current month.
8. Paid $2,500 cash for office salaries.
9. Paid $1,200 cash dividends to stockholders.
10.Received a check for $2,000 from a client in payment on account for commissions billed in transaction 4.

Answer 1

Answer: Please find answers in the explanation column

Explanation:

Account titles                               Debit                  Credit

To Record Investment by stockholders

1 Cash                              $40,000

Common Stock                                            $40,000

To record purchase of supplies on credit

2 Supplies                                   $500

Accounts Payable                                                    $500

To record payment in part for cash and signing a note

3 Equipment                            $25,000  

Cash                                                                $ 3,500

Note Payable                                                        $21,500

To record commission billed to clients

4 Accounts Receivable                   $4,000  

Service Revenue                                                        $4,000

To record rent paid for the month

5 Rent Expense                                   $700  

Cash                                                                            $700

To record cash paid to supplies purchased on account

6 Accounts Payable                        $250

               Cash                                                                        $250

To record receipt on advertising

7 Advertising Expense                 $800  

Accounts Payable                                                          $800

To record cash for salaries

8 Salaries Expense                    $2,500  

Cash                                                                        $2,500

To record cash paid as dividends

9 Dividends                            $1,200  

Cash                                                                       $1,200

To record receipts of cash from accounts receivable

10 Cash                                  $2,000  

Accounts Receivable                                                 $2,000