19E_2 - Horngren'S Financial And Managerial Accounting

Question

Question: The following transactions occurred for Wilke Technology Solutions: 

May 1 The business received cash of \(105,000 and issued common stock to Zoe Wilke. 

2 Purchased office supplies on account, \)550. 

4 Paid \(57,000 cash for building and land. The building had a fair market value of \)45,000. 

6 Performed services for customers and received cash, \(3,600. 

9 Paid \)350 on accounts payable. 

17 Performed services for customers on account, \(3,500. 

19 Paid rent expense for the month, \)1,200. 

20 Received \(1,500 from customers for services to be performed next month. 

21 Paid \)900 for advertising in next month’s IT Technology magazine. 

23 Received \(3,100 cash on account from a customer. 

31 Incurred and paid salaries, \)1,700

Posting journal entries to four-column accounts 

Requirements 2. Post the journal entries to the four-column accounts, and determine the balance in the account after each transaction. Assume that the journal entries were recorded on page 10 of the journal. Make sure to complete the Post. Ref. columns in the journal and ledger.

Step-by-Step Solution

Answer

Accounts payables are amounts owed to suppliers and required accounts are prepared in step 2.

Step-by-Step Solution Step 1: Definition of Accounts Receivables

Accounts payables are defined as the amount of money a company owes to the supplier of goods or services.

Step 2: Opening of Accounts

Cash                                                                                                                                  Account Number - 110
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 1	Common Stock		$105,000		$105,000
4	Building			$45,000	$60,000
	Land			$12,000	$48,000
6	Service Revenue		$3,600		$51,600
9	Accounts Payable			$350	$51,250
19	Rent expense			$1,200	$50,050
21	Prepaid Expense			$900	$49,150
23	Accounts Receivables		$3,100		$52,250
31	Salaries Expense			$1,700	$50,550

 

Accounts Receivables                                                                                                   Account Number – 120
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 17	Service Revenue		$3,500		$3,500
23	Cash			$3,100	$400

 

Office Supplies                                                                                                              Account Number – 130
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 2	Accounts Payable		$550		$550

 

Prepaid Advertising                                                                                                            Account Number – 140
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
21	Cash		$900		$900

 

Land                                                                                                                  Account Number – 150
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 4	Cash		$12,000		$12,000

 

Building                                                                                                              Account Number – 160
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 4	Cash		$45,000		$45,000

 

Accounts Payable                                                                                                             Account Number - 210
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 2	Office Supplies			$550		$550

 

Unearned Revenue                                                                                                                         Account Number – 220
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit

 

Common Stock                                                                                                             Account Number – 310
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 1	Cash			$105,000		$105,000

 

 

Service Revenue                                                                                                             Account Number – 410
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 6	Cash			$3,600		$3,600
17	Accounts Receivables			$3,500		$7,100

 

Rent Expense                                                                                                                   Account Number – 510
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 19	Cash		$1,200		$1,200

 

 

Salaries Expense                                                                                                             Account Number – 520
					Balance
Date	Item	PR	Debit	Credit	Debit	Credit
May 31	Cash		$1,700		$1,700