Question

The following events occurred for Favata Company. a. Received $17,500 cash from owners and issued stock to them. b. Borrowed $14,500 cash from a bank and signed a note due later this year. c. Bought and received $1,550 of equipment on account. d. Purchased land for $27000; paid $2.500 in cash and signed a long-term note for $24.500. e. Purchased $10,500 of equipment; paid $2.500 in cash and charged the rest on account Required: For each of the events in above, prepare journal entrie Required" in the first account field.) View transaction list Journal entry worksheet Received $17,500 cash from owners and issued stock to them. Record the transaction Note: Enter debits before credits. Transaction General Journal Debit Credit K Prev 3 of 12 Next

Answer 1

Date   Particulers Dr . Cr .

1. Cash a/c. Dr . 17500

To Stock capital. 17500

( Issued stock for cash)

2. Cash. a/c. Dr . 14500

To Note payable . 14500

(Being received Cash for issue

Note payable)

3. Equipment a/ c. Dr. 1550

To. Vendor a/c. 1550

( bought equipment on account)

4. Land a/c . Dr . 27000

To Cash a/c . 2500

To Long term note payable. 24500

( Purchase land and paid cash and

Issued note payable)

5. Equipment a/c. Dr. 10500

To Cash a/c . 2500

To. Vendor a/c . 8000

( Being equipment puchased and paid

cash 2500 and rest on account)