Chapter 2: 43PS-2 (page 115)
Journalizing transactions, posting to T-accounts, and preparing a trial balance
Consider the following transactional data for the first month of operations for Crystal Clear Cleaning.
Nov. 1 Stockholders contributed
2 The business paid \(4,000 to Pleasant Properties for November through February rent. (Debit Prepaid Rent)
3 Paid \)4,800 for a business insurance policy for the term November 1, 2018 through October 31, 2019. (Debit Prepaid Insurance)
4 Purchased cleaning supplies on account, \(320.
5 Purchased on account an industrial vacuum cleaner costing \)1,500. The invoice is payable November 25.
7 Paid \(3,900 for a computer and printer.
9 Performed cleaning services on account in the amount of \)4,700.
10 Received
16 Received \(15,000 for a 1-year contract beginning November
16 for cleaning services to be provided. Contract begins November 16, 2018, and ends November 15, 2019. (Credit Unearned Revenue)
17 Provided cleaning services and received \)400 cash.
18 Received a utility bill for \(175 with a due date of December 4, 2018. (Use Accounts Payable)
20 Borrowed \)36,000 from bank with interest rate of 6% per year.
21 Received \(500 on account for services performed on November 9.
25 Paid \)750 on account for vacuum cleaner purchased on November 5.
29 Paid \(200 for advertising.
30 Cash dividends of \)1,400 were paid to stockholders
2. Open a T-account for each account
Short Answer
Salaries expense is the compensation paid to employees and the required t-accounts are opened in Step 2.
Step by step solution
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