Question

1.

Les Account Property and equipment (net) Retained earnings Accounts payable Prepaid expenses Accrued expenses payable Long-term notes payable Other noncurrent assets Common stock ($0.10 par value) Balance Account $ 13,894 Receivables 9,606 Other current assets 1,257 Cash 108 Spare parts, supplies, and fuel 2,070 Other noncurrent liabilities 1,490 Other current liabilities 2,552 Additional Paid-in Capital 1 Balance $ 1,549 879 884 394 3,290 1,939 607 These accounts are not necessarily in good order and have normal debit or credit balances. Assume the following transactions (in millions, except for par value) occurred the next fiscal year beginning June 1 (the current year): a. Provided delivery service to customers, who paid $1,390 in cash and owed $24,704 on account. b. Purchased new equipment costing $3,434; signed a long-term note. c. Paid $7,864 cash to rent equipment and aircraft, with $3,136 for rent this year and the rest for rent next year. d. Spent $864 cash to repair facilities and equipment during the year. e. Collected $24,285 from customers on account. f. Repaid $150 on a long-term note (ignore interest). g. Issued 20 million additional shares of $0.10 par value stock for $16 (that's $16 million). h. Paid employees $9,276 for work during the year. i. Purchased spare parts, supplies, and fuel for the aircraft and equipment for $6,564 cash. j. Used $6,450 in spare parts, supplies, and fuel for the aircraft and equipment during the year. k. Paid $784 on accounts payable. I. Ordered $88 in spare parts and supplies.

Required:

1. Prepare journal entries for each transaction. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter amounts in millions, not dollars.)

- Provided delivery service to customers, who paid $1,390 in cash and owed $24,704 on account.

- Purchased new equipment costing $3,434; signed a long-term note.

- Paid $7,864 cash to rent equipment and aircraft, with $3,136 for rent this year and the rest for rent next year.

-Spent $864 cash to repair facilities and equipment during the year.

- Collected $24,285 from customers on account.

-Repaid $150 on a long-term note (ignore interest).

-Issued 20 million additional shares of $0.10 par value stock for $16 (that’s $16 million).

-Paid employees $9,276 for work during the year.

-Purchased spare parts, supplies, and fuel for the aircraft and equipment for $6,564 cash.

-Used $6,450 in spare parts, supplies, and fuel for the aircraft and equipment during the year.

-Paid $784 on accounts payable.

- Ordered $88 in spare parts and supplies.

Answer 1

Journal Entries Date Account Title and Explaination Debit Credit Post. Ref. 1,390.00 24,704.00 Cash Accounts Receivable Service Revenue (To record Service provided for cash and on account) 26,094.00 3,434.00 Equipment Long term Note Payable (To record Equipment purchased by issuing note) 3,434.00 SA 3,136.00 4,728.00 Rent Expense Prepaid Rent Cash (To record Cash paid for rent of equipment) $ 7,864.00 d 864.00 Repairs Expense Cash |(To record Repairs expenses paid) 864.00

24,285.00 Cash Accounts Receivable (To record collection of receivables) $ 24,285.00 150.00 Long term Note Payable Cash (To record repayment of Long term note) $ 150.00 8 16.00 Cash Common Stock (20 x $0.01) Paid In Capital in Excess of Par (To record issue of common stock) EAEA 0.20 15.80 9,276.00 Salaries Expense Cash (To record Salaries Expenses paid) 9,276.00 6,564.00 Spare parts, Supplies and fuel Cash |(To record purchase of spare parts and supplies, fuel) 6,564.00

6,564.00 Spare parts, Supplies and fuel Cash (To record purchase of spare parts and supplies, fuel) 6,564.00 6,450.00 Spare parts, supplies and fuel Expenses Spare parts, supplies and fuel |(To record spare parts, supplies and fuel used) 6,450.00 784.00 Accounts Payable Cash (To record payment of payables) 784.00 No Journal Entry Required at the time of Ordering Spareparts, supplies and fuel