3TI - Horngren'S Financial And Managerial Accounting

Question

EMB Consulting Services had the following transactions for the month of November. Journalize the transactions and include an explanation with each entry. 

Nov. 1 The business received \(10,000 cash and issued common stock. 

15 Purchased office supplies on account, \)400. 

18 Paid advertising bill, \(150. 

20 Received \)1,000 from customers for services rendered. 

28 Cash dividends of $500 were paid to stockholders

Step-by-Step Solution

Answer

Answer

Dividends are profits distributed to the shareholders and required entries are passed.

Step 1: Definition of Dividends

The dividends are defined as  the part of the profits of the business which are distributed among the shareholders or the owners of the company.

Step 2: Journal Entries

Date	Particulars	Amount ($)	Amount ($)
Nov 1	Cash	10,000
	Common Stock		10,000
	(Common stock issued)
Nov 15	Supplies	400
	Accounts Payable		400
	(Supplies purchased on credit)
Nov 18	Advertising Expense	150
	Cash		150
	(Advertising expenses paid)
Nov 20	Cash	1,000
	Service Revenue		1,000
	(Cash received for service revenue)
Nov 28	Dividends	500
	Cash		500
	(Dividends paid in cash)