Question

Halogen Laminated Products Company began business on January 1, 2021. During January, the following transactions occurred: Jan. 1 Issued common stock in exchange for $118,000 cash. 2 Purchased inventory on account for $27,000 (the perpetual inventory system is used). 4 Paid an insurance company $1,440 for a one-year insurance policy. Prepaid insurance was debited for the entire amount. 10 Sold merchandise on account for $11,200. The cost of the merchandise was $6,200. 15 Borrowed $22,000 from a local bank and signed a note. Principal and interest at 10% is to be repaid in six months. 20 Paid employees $5,200 salaries for the first half of the month. 22 Sold merchandise for $9,200 cash. The cost of the merchandise was $5,200. 24 Paid $14,200 to suppliers for the merchandise purchased on January 2. 26 Collected $5,600 on account from customers. 28 Paid $1,000 to the local utility company for January gas and electricity. 30 Paid $3,200 rent for the building. $1,600 was for January rent, and $1,600 for February rent. Prepaid rent and rent expense were debited for their appropriate amounts. Required: Post the transactions into the appropriate T-accounts.

Answer 1

T-Accounts:

Cash					Common stock
Jan.1	$118,000	Jan.4	$1,440				Jan.1	$118,000
Jan.15	$22,000	Jan.20	$5,200				Balance	$118,000
Jan.22	$9,200	Jan.24	$14,200
Jan.26	$5,600	Jan.28	$1,000		Sales revenue
		Jan.30	$3,200				Jan.10	$11,200
Balance	$129,760						Jan.22	$9,200
							Balance	$20,400
Inventory
Jan.2	$27,000	Jan.10	$6,200		Cost of goods sold
		Jan.22	$5,200		Jan.10	$6,200
Balance	$15,600				Jan.22	$5,200
					Balance	$11,400
Prepaid insurance
Jan.4	$1,440				Salaries expense
Balance	$1,440				Jan.20	$5,200
					Balance	$5,200
Prepaid rent
Jan.30	$1,600				Utilities expense
Balance	$1,600				Jan.28	$1,000
					Balance	$1,000
Accounts receivable
Jan.10	$11,200	Jan.26	$5,600		Rent expense
Balance	$5,600				Jan.30	$1,600
					Balance	$1,600
Accounts payable
Jan.24	$14,200	Jan.2	$27,000
		Balance	$12,800
Notes payable
		Jan.15	$22,000
		Balance	$22,000