Question

Required information The general ledger of Red Storm Cleaners at January 1, 2021, includes the following account balances: Credits Debits $ 18,500 7,700 3,700 13,500 Accounts Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Salaries Payable Common Stock Retained Earnings Totals $ 4,400 6,400 23,500 9,100 $ 43,400 $ 43,400 The following is a summary of the transactions for the year: 1. March 12 Provide services to customers, $57,000, of which $20,700 is on account. 2. May 2 Collect on accounts receivable, $17,700. 3. June 30 Issue shares of common stock in exchange for $6,000 cash. 4. August 1 Pay salaries of $6,400 from 2020 (prior year). 5. September 25 Pay repairs and maintenance expenses, $12,700. 6. October 19 Purchase equipment for $7,700 cash. 7. December 30 Pay $1,100 cash dividends to stockholders.

Answer 1

Answer
Account Titles and Explanation	Debit	Credit
Service Revenue	$        57,000
Retained Earnings		$        57,000
( To record Service Revenue )
Retained Earnings	$        12,700
Repairs and Main. Expense		$        12,700
( To record Repairs and Main. Expense   )
Retained Earnings	$          1,100
Dividends		$          1,100
( To record Dividends   )

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