Question

Cintu is a large marketer and distributor of food service products serving restaurants, hotels, schools, hospitals, and other institutions. The following transactions are typical of those that occurred in a recent year, but the amounts are simplified. a Borrowed $82,000 from a bank, signing a short-term note payable. b. Provided $105,800 in service to customers, with $99,200 on account and the rest received in cash c. Purchased equipment for $182,000 in cash. d. Incurred and paid employee wages of $2,300. e Received $900 on account from a customer. fincurred and paid $4 300 cash for travel costs during the year gPaid $8.500 cash on accounts payable n. Incurred $23.800 in utility expenses during the year, of which $17.000 was paid in cash and the rest owed on account Required: 1. For each of the above transactions, prepare accrual basis journal entries 2. Calculate the company's preliminary net income Complete this question by entering your answers in the tabs below. < Prey 4 of 5 Next >

Answer 1

1.

Transaction	General Journal	Debit	Credit
		$	$
a.	Cash	82,000
	Notes Payable		82,000
b.	Cash	6,600
	Accounts Receivable	99,200
	Service Revenue		105,800
c.	Equipment	182,000
	Cash		182,000
d.	Wages Expense	2,300
	Cash		2,300
e.	Cash	900
	Accounts Receivable		900
f.	Travel Expense	4,300
	Cash		4,300
g.	Accounts Payable	8,600
	Cash		8,600
h.	Utilities Expense	23,800
	Cash		17,000
	Accounts Payable		6,800

2. Preliminary net income : $ 75,400.

Preliminary net income = Service Revenue - Wages Expense - Travel Expense - Utilities Expense = $ 105,800 - $ 2,300 - $ 4,300 - $ 23,800 = $ 75,400