Question

The transactions completed by PS Music during June 2018 were described at the end of Chapter 1. The following transactions were completed during July, the second month of the business's operations Peyton Smith made an additional investment in PS Music in exchange for common stock by depositing Jul $5,000 in PS Music's checking account Instead of continuing to share office space with a local real estate agency, Peyton decided to rent office space near a local music storee. Paid rent for July, $1,750 Paid a premium of $2,700 for a comprehensive insurance policy covering lability, theft, and fire. The 1 policy covers a one-year period Received $1,000 on account 2 On behalf of PS Music, Peyton signed a contract with a local radio station, KXMD, to provide guest spots for the next three months. The contract rehres PS Music to provide a guest disc jockey for 80 hours per month for a monthly fee of $3,600. Any addiional hours beyond 80 will be biled to KXMD at $40 per hour In accordance with the contract, Peyton received $7 200 from KXMD as an advance payment for the first two months Paid $250 on account Paid an altoney $900 for reviewing the July 3 contract with KXMD (Record as Miscellaneous Expense) Purchased office equipment on account from Office Mart, $7.500 5 8 Paid for a newspaper advertisement, $200. Received $1.000 for serving as a disc jockey for a party 11 Pad $700 to a local audio electronics store for rental of digital recording equipment 13 Paid wages of$1.200 to receptionist and part-tme assistant 14

Answer 1

In the books of PS Music:

Date	Account Titles	Debit	Credit
July		$	$
1	Cash	5,000
	Common Stock		5,000
1	Office Rent Expense	1,750
	Cash		1,750
1	Prepaid Insurance	2,700
	Cash		2,700
2	Cash	1,000
	Accounts Receivable		1,000
3	Cash	7,200
	Unearned Revenue		7,200
3	Accounts Payable	250
	Cash		250
4	Miscellaneous Expense	900
	Cash		900
5	Office Equipment	7,500
	Accounts Payable		7,500
8	Advertising Expense	200
	Cash		200
11	Cash	1,000
	Fees Earned		1,000
13	Equipment Rent Expense	700
	Cash		700
14.	Wages Expense	1,200
	Cash		1,200
16.	Cash	2,000
	Fees Earned		2,000
18	Supplies	850
	Accounts Payable		850
21	Music Expense	620
	Cash		620
22	Advertising Expense	800
	Cash		800
23	Cash	750
	Accounts Receivable	1,750
	Fees Earned		2,500
27	Utilities Expense	915
	Cash		915
28	Wages Expense	1,200
	Cash		1,200
29	Miscellaneous Expense	540
	Cash		540
30	Cash	500
	Accounts Receivable	1,000
	Fees Earned		1,500
31	Cash	3,000
	Fees Earned		3,000
31	Music Expense	1,400
	Cash		1,400
31	Dividends	1,250
	Cash		1,250

Answer 2

The transactions completed by PS Music during June 2018 were described at the end of Chapter...