Question

Quality Service Inc. has the following account balances in their Chart of accounts as at June 1, 2018: o Cash - $138,000 o Accounts receivable - $0 o Land - $30,000 o Building - $0 • Supplies - $0 Salary expense - $0 Notes payable - $0 Accounts payable - $0 Quality, capital - $70,000 Service revenue - $98,000 Utilities - $0 The company also presented the following transactions for the month: June 1 Purchased supplies for $1000 on account June 4. Purchased a building for $62,100 cash June 6. Performed service for a client on account, $12,000 June 10. Borrowed $7,000 cash, signing a note payable June 13 Paid the liability from June 1 June 17. Sold for $15,000 land that had cost this same amount June 21. Received $8000 cash from June 6 transaction June 30. Paid utilities expense of $600 and salary expense $2,500

Answer 1

1.

transaction on the accounting . Effect of each equation. As we have accounting equation formula as- Assets & Expenses & Drawings - Liabilities & Revenue - + Owners Equity of following transactions - thus, effect June 1 supplies account accounts payable increases with $ 1000 increases e u and I June 4 Buělding account Cash e increases with $622oo decreases cu o and 0 June 67 account Receivable alc will and service revenue ale ce increase with $ 12000 se LE Junelo Cash all increases with Notes payable ala u u $7000 u and . June 13. Jun 17. Same 21 Here account payable decreases with $1000 and - Cash also decreases with $1ooo Cash will increase with $1.500 and land alc will decrease with $ 45000 hue, cash ale will increase by $800 and Account Receivable well decrease by $ 80oo. utilities & Salary Expense ale will increase by $ 600 12.500 respectively & cash afc will decrease by $3200 - June 30 #learnthesmarterway

2.

Towinal Entries Date June 1 lauticulars Supplies Dr. CA Gr. O looo June 4 building June 6 12ooo Tune lo June 13 1000 - To accounts payable (Parchased supplies on alc) 62100 - To Cash 62100 & Purchased building for cash) Accounts Receivable to service Revenue Cherformed service on alc) Cash Tooo - To Notes Payable 7000 (borrowed cash on notes payable) accounts Payable - to cash Chaid liability of suppliescnale) Cash _ 15000 To Land. 15000 (Sold land for cash) Cash . 8000 A to accounts Receivable 2000 Creceived cash on ale of service peforned) Utilities Salary Expense 3100 claid utilities & salary expenses for cash) June 17 June al June 30. 25oo Cash

3.

3. Balance of each account at June 30th, 2018 Cash- $ 10/800 1138000+7000 + 1 5000+8000 - 62100 - 1000 - 31007 Account Receivable y $4000 [12000 - 8000] Lance - $ 15000 (30000 - 15oo] Building - $62100 Supplies - $ 1000 Salary Expense - $ 2500 Notes payable - $ 7000 Accounts payable - $0 quality. capital - 870ooo Service Revenue - $ llocs [98000+ 12000] Utilities - $600