Question

Journalizing transactions

Harper Sales Consultants completed the following transactions during the latter part of January:

Jan. 22 Performed services for customers on account, \(7,500.

30 Received cash on account from customers, \)8,000.

31 Received a utility bill, \(220, which will be paid during February.

31 Paid monthly salary to salesman, \)2,500.

31 Received \(2,310 for three months of consulting service to be performed starting in February.

31 Cash dividends of \)950 were paid to stockholders.

Journalize the transactions of Harper Sales Consultants. Include an explanation with each journal entry.

Short answer

The dividend is distributed profit and required journal entries are passed is step 2.

Step-by-step solution

Definition of Dividend

The dividends are defined as the part of profits that are distributed to the owner or shareholder of the company.

Journal Entries

	Journal entry
Date	Particulars	Debit ($)	Credit ($)
Jan
22	Accounts Receivables	7,500
	Service Revenue		7,500
	(Services provided on credit)
30	Cash	8,000
	Accounts Receivables		8,000
	(Cash received from clients)
31	Utility Expense	220
	Accounts Payable		220
	(Utility expense incurred)
31	Salary Expense	2,500
	Cash		2,500
	(Salary expenses are paid)
31	Cash	2,310
	Unearned Revenue		2,310
	(Cash received for unearned revenue)
31	Dividends	950
	Cash		950
	(Cash Dividends are paid)