Question

ournalize transactions, post, and prepare a trial balance.

(LO 1, 2, 3, 4)

Maquoketa Services was formed on May 1, 2017. The following transactions took place during the first month.

Transactions on May 1:

• 1.Jay Bradford invested $40,000 cash in the company, as its sole owner.
• 2.Hired two employees to work in the warehouse. They will each be paid a salary of $3,050 per month.
• 3.Signed a 2-year rental agreement on a warehouse; paid $24,000 cash in advance for the first year.
• 4.Purchased furniture and equipment costing $30,000. A cash payment of $10,000 was made immediately; the remainder will be paid in 6 months.
• 5.Paid $1,800 cash for a one-year insurance policy on the furniture and equipment.

Transactions during the remainder of the month:

• 6.Purchased basic office supplies for $420 cash.
• 7.Purchased more office supplies for $1,500 on account.
• 8.Total revenues earned were $20,000—$8,000 cash and $12,000 on account.
• 9.Paid $400 to suppliers for accounts payable due.
• 10.Received $3,000 from customers in payment of accounts receivable.
• 11.Received utility bills in the amount of $380, to be paid next month.
• 12.Paid the monthly salaries of the two employees, totaling $6,100.

Instructions

(a)  

Prepare journal entries to record each of the events listed. (Omit explanations.)

(b)  

Post the journal entries to T-accounts.

(c)  

Prepare a trial balance as of May 31, 2017.

Trial balance totals $81,480

Answer 1

Please refer below handwritten notes

DATE Journal Entries Account Title Cash Alc To Jay Bradford's capital Alc. Debit(a) 40,000 Credit ($) DY Rads nits 40,000 Rent Ak 2,050 57,000 DY (24.000 100 px (24,000x) 2,000 22,000 Prepaid Rent Alc TO cash 24,000 2000 0,050 Dr 30,000 10,000 20,000 ead 4. Furniture & Equipment Ale TO Cash Alc TO Accounts payable Al AС 5 Insurance All DY (1800x1 Prepaid insurance Alc TO CashAle Dr (1800 x1) 150 1,650 1,800 6 Dr 420 Office supplies Ak TO Cash 420 1,500 7. Ottice supplies All DY TO Accounts payable Alc 1,500 DY 8- 8,000 12,000 Cash Alc Accounts Receivable Alc. TO service Revenue Dr 20,000 400 9. Accouts payable Alc TO CashAle 400 3,000 10 cashala TO Accounts Receivablen/ 3,000 PAGE classmate

DATE utility Expenses ALL pr 380 utilities payable 380 T 12 pl 6,100 Salaries Ale TO Cash Alc 6,100 By Rent T-accounts. Cash ALL To Jay Bradford 40,000 To sewice Revenue 8000 By prepaid rest To accounts Receivable 3,000 By Furniture & Equipment By Insurance By Prepaid Insurance By office supplies By Accounts payable 51,000 By Salaries End. Balonce Lor Jay Bradford's capital Ale By cash 2,000 22.000 10,000 iso 1,650 420 400 8,280 5100 140,000 End Balence 40,000 140,000 40,000 Rent Alc TO tash 2,000 2,000 2,000 By P&L ALC 2000 Prepaid Rent Alc. 22,000 TO Cash End Balance 22,000 22,000 22.000

DATE Furniture & Equipment Alc. To cash 110,000 TO ACCOw poyable 20,000 Balance 30,000 30,000 30,000 or to cash 00 20.000 1500 Accounts payable Ak 400 By Furniture & Equipment By office supplies 21,100 (21,500 Insurance Ale and Balance . 21,500 IDV TO Cash Ale 150 By P&L ALC 150 150 150 o pr Prepaid, Insurance Alc 1,650 TO Cash End. Balance 1,650 1,650 1,650 V office supplies Ac To cash ac 420 TO Accounts payable 1500 and Balance 1,920 0 1,920 1920 Receivable AC CH lor TO Service Revenue Accounts 12,000 13,000 By cash End. Balance 9,000 12.000 12,000 PAGE