Question

Green Wave Company plans to own and operate a storage rental facility. For the first month of operations, the company has the following transactions. 1 Issue 10, 000 shares of common stock in exchange for $36, 000 in cash. 5 Purchase land for $21, 000. A note payable is signed for the full amount. 9 Purchase storage container equipment for $8, 400 cash. January January January January 12 Hire three employees for $2,400 per month. 5. January 18 Receive cash of $12,400 in rental fees for the current month. 6. January 23 Purchase office supplies for $2, 400 on account. 7. January 31 Pay employees $7, 200 for the first month's salaries. 3 4. 2. Post each transaction to T-accounts and calculate the ending balance for each account. For each posting, indicate the corresponding transaction number and the appropriate transaction amount. Since this is the first month of operations, all T-accounts have a beginning balance of zero.

Answer 1

Ans:

2. T- Accounts

Land
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 5	Notes Payable		$21,000		$21,000

Notes Payable
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 5	Land			$21,000	$21,000

Accounts Payable
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 23	Supplies			$1,200	$1,200

Service Revenue
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 18	Cash			$12,400	$12,400

Equipment
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 9	Cash		$8,400		$8,400

Salary Expenses
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 31	Cash		$7,200		$7,200

Supplies
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 23	Accounts Payable		$2,400		$2,400

Common Stock
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 1	Cash			$36,000	$36,000

Cash
Date	Particulars	Ref	Debit ($)	Credit ($)	Balance ($)
Jan 1	Common Stock		$36,000		$36,000
Jan 9	Equipment			$8,400	$27,600
Jan 18	Service Revenue		$12,400		$40,000
Jan 31	Salary			$7,200	$32,800