Question

Paid $1,800 for six month insurance policy. When journalizing this transaction the account will be debited for $1,800 and the account will be credited for $1,800. Question 20 3 pts Purchased $9,800 of supplies on account. When journalizing this transaction the account will be debited for $9,800 and the account will be credited for $9,800.

Answer 1

Sol 019 Paid for Six Months - Insurance $ 1,800 020 Purchase of supplies on account $ 9,800 021 Fee earned on account $ 2,250 To understand accounting entry let us understandaccounting rules Personal Account: Debit Receiver and Credit Giver Real Accounts: Debit What comes in and Credit What goes out Nominal Accounts: Debit all expenses and losses, credit all incomes and gains The accounting entry is as below: Question Journal Entry Debit Credit Explanation Insurance a/c $ 1,800 Since Insurance Is Nomianl account and Expenses hence Debited. Q19 To Cash a/c $ 1,800 Since cash Is real account and it goes out, hence Credited.

Purchases a/c $ 9,800 Q20 Since Purchases Is Nominal account and Expenses hence Debited. Since Accounts Payable is Personal account and is giver, hence 9,800 Credited. To Accounts Payables $ Since Accounts Payable is Personal account and is Receiver, hence Debited. Accounts Receivable $ 2,250 Q21 To Fee Revenue a/c $ 2,250 Since Fee Revenue is Nominal account and Income hence Credited. Summary of Answers Q19 When Journalizing this transaction the account Insurance will be debited for $1800 and the account Cash will be credited for $1800 Q20 When Journalizing this transaction the account Purchases will be debited for $9800 and the account Accounts Payable will be credited for $9800 Q21 When Journalizing this transaction the account Accounts Receivable will be debited for $2250 and the account Fee Revenue will be credited for $1800