Question

SP04-05 Given P04-05 Given Data P04-05: BALBOA'S GYM October Transactions October 8,500 12,000 Receive membership dues for October Issue common stock for cash Purchase boxing equipment: Price of equipment Cash paid at time of purchase Pay for advertising Pay dividends to stockholders Pay six months' liability insurance beginning Nov. 1 Receive cash in advance for November memberships Receive but do not pay utility bill Pay employees' salaries for month 9,600 4,800 1,500 4,400 6,900 5,600 5,200 7,300 Additional Information: Beginning October cash balance 16,600

Answer 1

Date	Description	Debit	Credit
Oct-02	Cash	8500
	Service revenue		8500
	(Receive membership dues)
Oct-05	Cash	12000
	Common stock		12000
	(Issue common stock)
Oct-09	Equipment	9600
	Cash		4800
	Accounts payable		4800
	(Purchase boxing equipment, 50% is paid in cash and balance 50% is due)
Oct-12	Advertising expenses	1500
	Cash		1500
	(Paid advertising expenses)
Oct-19	Dividend	4400
	Cash		4400
	(Dividend paid)
Oct-22	Prepaid insurance	6900
	Cash		6900
	(Prepaid insurance paid)
Oct-25	Cash	5600
	Deferred Revenue		5600
	(Receive membership dues in advance)
Oct-30	Utilities	5200
	Utilities payable		5200
	(Receive current month utilities bill)
Oct-31	Salaries	7300
	Cash		7300
	(Paid current month salaries)
	Requirement 2 Cash Date Description Debit Credit Oct-01 Beginning balance 16600 Oct-02 Receive Membership dues 8500 Oct-05 Issue of common stock 12000 Oct-09 Purchase of equipment 4800 Oct-12 Advertising expense 1500 Oct-19 Dividend paid 4000 Oct-22 Prepaid insurance psid 6900 Oct-25 Prepaid income received 5600 Oct-31 Salaries paid 7300 Oct-31 Closing balance 18200 Total 42700 42700
	Cash Date Description Debit Oct-01 Beginning balance 16600 Oct-02 Receive Membership dues 8500 Oct-05 Issue of common stock 12000 Oct-09 Purchase of equipment -4800 Oct-12 Advertising expense -1500 Oct-19 Dividend paid -4000 Oct-22 Prepaid insurance psid -6900 Oct-25 Prepaid income received 5600 Oct-31 Salaries paid -7300 Oct-31 Closing balance 18200