Question

Selected transactions for Dowis Dry Cleaners, Inc. are listed below. The company opened for business on March 1, 2019. Prepare the necessary journal entries in good form. The company also prepares adjusting entries on a monthly basis. Identify each transaction BY DATE. You may omit explanations. 3/1 Issued 10,000 shares of common stock for $18,000 cash. 3/1 Purchased a used truck for $10,000, paying $5,000 cash and the remaining balance on account. 3/1 Paid $3,600 on a 6-month insurance policy, effective March 1. 3/3 Purchased supplies for $1,800 on account. u

Answer 1

	Journal entries in the book of Dowis	Dry Cleaner
Date	Particulars	$	$
1-Mar	Cash	18000
	Common stock		18000
1-Mar	Truck	10000
	Cash		5000
	Accounts Payable		5000
1-Mar	Insurance expenses	600
	Prepaid expenses	3000
	Cash		3600
3-Mar	Supplies	1800
	Cash		1800
4-Mar	Cash	8900
	Accounts Receivable		8900
18-Mar	Accounts Payable	2000
	Cash		2000
20-Mar	Salaries Expense	1500
	Cash		1500
21-Mar	Cash	1800
	Accounts Receivable		1800
29-Mar	Cash	450
	Account Receivable A/c		450
30-Mar	Dividend	1000
	Cash		1000
31-Mar	Depreciation Expense	350
	Equipment		350
31-Mar	Cash	1700
	Supplies		1700
31-Mar	Wages Expense	1100
	Wages Payable		1100
	Total	52200	52200