Question

Problem 2-3A Preparing and posting journal entries: preparing a trial balance Kaseh Nawar opens a web consulting business called Meshreki Consultants and completes the following transactions in March. March 1 Nawar invested $150,000 cash along with $22,000 in office equipment in the company. 2 The company prepaid $6,000 cash for six months' rent for an office. (Hint: Debit Prepaid Rent for $6,000.) 3 The company made credit purchases of office equipment for $3,000 and office supplies for $1,200. Payment is due within 10 days. 6 The company completed services for a client and immediately received $4,000 cash. 9 The company completed a $7,500 project for a client, who must pay within 30 days. 12 The company paid $4,200 cash to settle the account payable created on March 3. 19 The company paid $5,000 cash for the premium on a 12-month insurance policy. (Hint: Debit Prepaid Insurance for $5,000.) 22 The company received $3,500 cash as partial payment for the work completed on March 9. 25 The company completed work for another client for $3,820 on credit. 29 Nawar withdrew $5,100 cash from the company for personal use. 30 The company purchased $600 of additional office supplies on credit. 31 The company paid $500 cash for this month's utility bill. Required 1. Prepare general journal entries to record these transactions (use the following account titles). Their account numbers are in parentheses (use the balance column format): Cash (101); Accounts Receivable (106): Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); K. Nawar. Capital (301); K. Nawar. Withdrawals (302); Services Revenue (403); and Utilities Expense (690).

Answer 1

Date Account Ref. Debit Credit Mar-01 Cash Office equipment K. Nawar, Capital 101 $ 163 $ 301 150,000 22,000 $ 172,000 2. 6,000 Prepaid Rent Cash 131 $ 101 $ 6,000 3 Office equipment Office Supplies Accounts Payable 163 $ 124 $ 201 3,000 1,200 $ 4,200 6 4,000 Cash Service revenue 101 $ 403 $ 4,000 9 7,500 Accounts Receivable Service revenue 106 $ 403 $ 7,500 12 4,200 Accounts Payable Cash 201 $ 101 $ 4,200 19 5,000 Prepaid Insurance Cash 128 $ 101 $ 5,000 22 3,500 Cash Accounts Receivable 101 $ 106 $ 3,500

25 3,820 Accounts Receivable Service revenue 106 $ 403 $ 3,820 29 5,100 K. Nawar, Drawing Cash 302 $ 101 $ 5,100 30 600 Office Supplies Accounts Payable 124 $ 201 $ 600 31 500 Utilities expense Cash 690 $ 101 $ 500