Question

Following are the transactions for Valdez Services.

a. The company paid $2000 cash for payment on a 3 -month-old account payable for office supplies.

b. The company paid $2200 cash for the just completed two-week salary of the receptionist.

c. The company paid $50.000 cash for equipment purchased.

d. The company paid $800 cash for this month's utilities.

e. The company paid a $5.000 cash dividend to the owner (sole shareholder).

1. Prepare general journal entries for the above transactions of Valdez Services.

2. Listed below are three reasons why a transaction would not result in an expense. Match each of the reasons to the transaction it properly describes.

Answer 1

Required 1:

Transactions	Debit ($)	Credit ($)
a.	Accounts payable	2000
	To Cash		2000
	(being payment of accounts payable)
b.	Salary	2200
	To Cash		2200
	(being payment for salary)
c.	Equipment	50000
	To Cash		50000
	(being purchase of equipment)
d.	Utilities	800
	To Cash		800
	being utilities expenses paid)
e.	Dividends payable	5000
	To Cash		5000
	(being dividend paid)

Required 2.

The following are the transaction

Transaction

cash dividend paid to owners

cash paid for stellement of 3-month old account payable

purchase of equipment by cash