Question

1. Journalize the following business transactions in general journal form. Identify each transaction by letter. Be sure to show ALL work!

1. The owner, Mai Li, invests $40,000 in cash in starting a real estate office operating as a sole proprietorship.
2. Purchased $500 of supplies on credit.
3. Purchased equipment for $9,000, paying $4,000 in cash and signed a 30-day, $5,000, note payable.
4. Real estate commissions billed to clients amount to $4,000.
5. Paid $800 in cash for the current month’s rent.
6. Paid $200 cash on account for supplies purchased in transaction b.
7. Received a bill for $600 for advertising for the current month.
8. Paid $2,500 cash for office salaries and wages.
1. Li withdrew $1,800 from the business for living expenses.
10. Received a check for $2,500 from a client in payment on account for commissions billed in transaction d.

Answer 1

Trandaction al Credit Bebit Journal Cash $ 40,000 $40,000 Owner's Capital (To record cash invested) $500 Supplies Accounts (Te second $ 5oo payable seyppeies purchased) $9,000 Equipment cash Notes Payable (To record equipment purchased) $4,000 $5,000 $4,000 | Accounts Receivable $4,000 Service Revenue To record commissions billed to customers) $800 $ 800 | Reat expense Cash (To record rent paid)

$ 200 Accounts payable Cash To record cash paid) $200 g $600 Advertising Expense Accounts payable (To record advertising expense) $600 h. salaries and wages Expense &2,500 cash $2,500 (To record salaries and wages paid) $ 1,800 Owner's Drawings Casho (To record withdrew from business) $ 1,800 $2,500 Cash Accounts Receivable (To recond check received) $2,500