Question

The following account balances are provided for Green Goblin Corporation at December 31 2018: Title Accounts payable Accounts receivable Bank loan due June 1, 2020 Cash Commissions payable Salaries and wages payable Common stock (no par) Equipment (net) Interest payable Interest receivable Investments Prepaid expenses Retained eamings Supplies Unearmed revenue Balance 65,000 90,000 154,000 45,000 12,000 16,000 200,000 318,750 1200 450 33,000 28,000 71,700 25,000 32,000 All January 2019 transactions follow: 1. Provided services on account for a total of $375,000 2. Provided services worth $23,000 paid for in prior months. 3. Used S14,000 in supplies 4. Sold equipment with book value of $23,000 for $19,000 cash. 5. Paid accounts payable of S51,500 6. Collected $346,000 on customer accounts. 7. Issued common stock for $125,000 8. Purchased a vehicle worth S50,000 in exchange for a note payable due on March 1, 2020. 9. Paid S195,000 in salaries, including S16,000 owed from the month of December 2018. 10. Paid $83,000 in commissions including those owed at December 31 11. Collected S18,500 for services to be provided in March. 12. Received a $2,500 bill for December utilities. 13. Paid $2,250 for January and February radio advertisements. 14. Received an interest payment of $900 including the interest accrued at 12/31/2018. 15. Paid $12,000 for January rent. 16. Paid income tax expense of $28,706

Answer 1

1. Journal entries

Date	Particulars	L.F	Amount ($)	Amount ($)
1	Account Receivable		375,000
	Service Revenue			375,000
2	Unearned Revenue		23,000
	Service Revenue			23,000
3	Supplies Expense		14,000
	Supplies			14,000
4	Cash		19,000
	Loss on sale of equipment		4,000
	Equipment			23,000
5	Accounts Payable		51,500
	Cash			51,500
6	Cash		346,000
	Account Receivable			346,000
7	Cash		125,000
	Common Stock			125,000
8	Vehicle		50,000
	Note Payable			50,000
9	Salaries and Wages Payable		16,000
	Salaries Expense		179,000
	Cash			195,000
10	Commissions Payable		12,000
	Commission Expense		71,000
	Cash			83,000
11	Cash		18,500
	Unearned Revenue			18,500
12	Utilities Expense		2,500
	Utility Payable			2,500
13	Advertisement Expense		1,125
	Prepaid Expenses		1,125
	Cash			2,250
14	Cash		900
	Interest Income			450
	Interest Receivable			450
15	Rent Expense		12,000
	Cash			12,000
16	Income tax expense		28,706
	Cash			28,706