Question

Instructions Findlay Testing Inc. provides water testing and maintenance services for owners of hot tubs and swimming pools. During September the following transactions occurred: September Transactions: Sept. 1 2 5 Issued common stock for $20,000. Purchased chemical supplies for $1.880 cash. Paid office rent for October, November, and December, the rent is $800 per month. Purchased $1.290 of advertising for September on account. Billed the city of Bellefontaine $2,100 for testing the water in the city's outdoor pools during September. Received $8,250 from Alexander Blanchard upon completion of overhaul of his swimming pool water circulation system. Since the job was completed and collected for on the same day, no bill was sent to Blanchard. Received S835 from the city of Bellefontaine for water testing that was previously billed. Paid $3,970 to hourly employees for work performed in September 18 25 30 Required: 1. Prepare a journal entry for each transaction. 2. Post the journal entries to the appropriate T-accounts.

Answer 1

1.

Date	Account Titles	Debit	Credit
		$	$
Sept 1	Cash	20,000
	Common Stock		20,000
Sept 2	Supplies	1,880
	Cash		1,880
Sept 5	Prepaid Rent	2,400
	Cash		2,400
Sept 8	Advertising Expense	1,290
	Accounts Payable		1,290
Sept 13	Accounts Receivable	2,100
	Service Revenue		2,100
Sept 18	Cash	8,250
	Service Revenue		8,250
Sept 25	Cash	835
	Accounts Receivable		835
Sept 30	Wages Expense	3,970
	Cash		3,970

2.

Cash
Sept 1	20,000	Sept 2	1,880
Sept 18	8,250	Sept 5	2,400
Sept 25	835	Sept 30	3,970
End. bal.	20,835
Accounts Receivable
Sept 13	2,100	Sept 25	835
End. bal.	1,265
Supplies
Sept 2	1,880
End. bal.	1,880
Prepaid Rent
Sept 5	2,400
End. bal.	2,400
Accounts Payable
		Sept 8	1,290
		End. bal.	1,290
Common Stock
		Sept 1	20,000
		End. bal.	20,000
Service Revenue
		Sept 13	2,100
		Sept 18	8,250
		End. bal.	10,350
Wages Expense
Sept 30	3,970
End. bal.	3,970
Advertising Expense
Sept 8	1,290
End. bal.	1,290