Question

Sheffield Security Company provides security services. Selected transactions for Sheffield are presented below. Oct. 1 Invested $63,000 cash in the business. 2 Hired part-time security consultant. Salary will be $2,000 per month. First day of work will be October 15. 4 Paid one month of rent for building for $2,000. 7 Purchased equipment for $17,000, paying $3,900 cash and the balance on account. 8 Paid $600 for advertising. 10 Received bill for equipment repair cost of $380. 12 Provided security services for event for $3,400 on account. 16 Purchased supplies for $470 on account. 21 Paid balance due from October 7 purchase of equipment. 24 Received and paid utility bill for $128. 27 Received payment from customer for October 12 services performed. 31 Paid employee salaries and wages of $5,400.

(a) Journalize the transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31 Oct. 1Oct. 2Oct. 4Oct. 7Oct. 8Oct. 10Oct. 12Oct. 16Oct. 21Oct. 24Oct. 27Oct. 31

Answer 1

(a)

Prepare journal entries as follows:

Date	Account Titles	Debit	Credit
October
1	Cash	$63,000
	Common stock		$63,000
2	No Entry
4	Prepaid Rent	$2,000
	Cash		$2,000
7	Equipment	$17,000
	Cash		$3,900
	Accounts payable		$13,100
8	Advertising expense	$600
	Cash		$600
10	Repair Expense	$380
	Accounts payable		$380
12	Accounts receivable	$3,400
	Service revenue		$3,400
16	Supplies	$470
	Accounts payable		$470
21	Accounts payable	$13,100
	Cash		$13,100
24	Utilities expense	$128
	Cash		$128
27	Cash	$3,400
	Accounts receivable		$3,400
31	Salaries and wage expense	$5,400
	Cash		$5,400

______________________________________________________________________

Additional Working for better understanding of Ledger posting and Trial balance as follows:

Cash
1	$63,000	4	$2,000
27	$3,400	7	$3,900
		8	$600
		21	$13,100
		24	$128
		31	$5,400
End. Bal.	$41,272
Prepaid Rent
4	$2,000
End. Bal.	$2,000
Equipment
7	$17,000
End. Bal.	$17,000
Accounts receivable
12	$3,400	27	$3,400
End. Bal.	$0
Salaries and Wage expense
31	$5,400
End. Bal.	$5,400
Utilities expense
24	$128
End. Bal.	$128
Repair expense
10	$380
End. Bal.	$380
Common stock
		1	$63,000
		End. Bal.	$63,000
Accounts payable
21	$13,100	7	$13,100
		10	$380
		16	$470
		End. Bal.	$850
Advertising expense
8	$600
End. Bal.	$600
Supplies
16	$470
End. Bal.	$470
Service revenue
		12	$3,400
		End. Bal.	$3,400

__________________________________________________________________

Trial Balance
	Debit	Credit
Cash	$41,272
Accounts receivable	$0
Supplies	$470
Prepaid rent	$2,000
Equipment	$17,000
Accounts payable		$850
Common stock		$63,000
Service revenue		$3,400
Salaries and wage expense	$5,400
Advertising expense	$600
Repair expense	$380
Utilities expense	$128
Total	$67,250	$67,250

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