Question

Feb. 1		Issued 5,500 shares of Skysong Cleaning Services common stock for $14,300. Each share has a $1.50 par.
1		Borrowed $8,800 on a 2-year, 6% note payable.
1		Paid $9,920 to purchase used floor and window cleaning equipment from a company going out of business ($5,300 was for the floor equipment and $4,620 for the window equipment).
1		Paid $240 for February Internet and phone services.
3		Purchased cleaning supplies for $1,080 on account.
4		Hired 4 employees. Each will be paid $530 per 5-day work week (Monday– Friday). Employees will begin working Monday, February 9.
5		Obtained insurance coverage for $10,820 per year. Coverage runs from February 1, 2022, through January 31, 2023. Karen paid $2,705 cash for the first quarter of coverage.
5		Discussions with the insurance agent indicated that providing outside window cleaning services would cost too much to insure. Karen sold the window cleaning equipment for $4,350 cash.
16		Billed customers $4,290 for cleaning services performed through February 13, 2022.
17		Received $612 from a customer for 4 weeks of cleaning services to begin February 21, 2022. (By paying in advance, this customer received 10% off the normal weekly fee of $170.)
18		Paid $330 on amount owed on cleaning supplies.
20		Paid $3 per share to buy 330 shares of Skysong Cleaning Services common stock from a shareholder who disagreed with management goals. The shares will be held as treasury shares.
23		Billed customers $4,730 for cleaning services performed through February 20.
24		Paid cash for employees’ wages for 2 weeks (February 9–13 and 16–20).
25		Collected $2,750 cash from customers billed on February 16.
27		Paid $240 for Internet and phone services for March.
28		Declared and paid a cash dividend of $0.25 per share

Journalize the February transactions.

Answer 1

Answer
General Journal
Date	particulars	Debit	Credit
01-Feb	Cash	$      14,300
	To Common Stock(5500*$1.5)		$           8,250
	To Paid in Capital excess of par(balanceing Figure)		$           6,050
	(Being 5500 shares issued $14300)
01-Feb	Cash	$        8,800
	To 6% Note Payable		$           8,800
	(Being amount borrowed against note payable)
01-Feb	Equipment	$        9,920
	To Cash		$           9,920
	(Being amount of Equipment purchases)
01-Feb	Utility Expenses	$           240
	To Cash		$              240
	(Being amt paid for internet & telephone exp)
03-Feb	Supplies	$        1,080
	To Accounts Payable		$           1,080
	(Being amount of supplies purchased on account)
04-Feb	No Entry
05-Feb	Prepaid Insurance	$        2,705
	To Cash		$         2,760.00
	(Being Amout of Prepaid Insurance)		$           2,705
05-Feb	cash	$        4,350
	Loss on sale of Equipment	$             60
	To Equipment		$           4,410
	(Being amout received for sale of Equipment)
16-Feb	Accounts receivable	$        4,290
	To Service revenue		$           4,290
	(Being amount of service performed to client on account)
17-Feb	Cash	$           612
	To Unearned Service Revenue		$              612
	(Being amount of unearned service revenue received )
18-Feb	Accounts Payable	$           330
	To Cash		$              330
	(Being amount paid for supplies purchased on account)
20-Feb	Treasury Stock	$           990
	To Cash		$              990
	(being amount of purchased of own stock 330@$3)
23-Feb	Accounts receivable	$        4,730
	To Service revenue		$           4,730
	(Being amount of cleaning servce performed to customer)
24-Feb	Salaries & Wages	$        4,240
	To Cash(4*2*530)		$           4,240
	(Being amount of salary & wages paid)
25-Feb	Cash	$        2,750
	To Accounts Receivable		$           2,750
	(Being amount received from customer)
27-Feb	Prepaid Expenses	$           240
	To Cash		$              240
	(Being amount paid for internet and phone service of march in advance)
28-Feb	Dividend	$        1,293
	To Cash		$           1,293
	(being Amount of Dividend paid to (5500-330)=5170 [email protected]
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