The McMillan Corporation incorporated on September 2, 2011. The company engaged in thefollowing transactions during its first month of operations:Sept. 2 Issued capital stock in exchange for $900,000 cash.Sept. 4 Purchased land and a building for $350,000. The value of the land was $50,000, andthe value of the building was $300,000. The company paid $200,000 cash and issued anote payable for the balance.Sept. 12 Purchased office supplies for $600 on account. The supplies will last for severalmonths.Sept. 19 Billed clients $75,000 on account.Sept. 29 Recorded and paid salary expense of $24,000.Sept. 30 Received $30,000 from clients billed on September 19.A partial list of the account titles used by the company includes:Cash Notes PayableAccounts Receivable Accounts PayableOffi ce Supplies Capital StockLand Client RevenueBuilding Salary Expensea. Prepare journal entries, including explanations, for the above transactions.b. Post each entry to the appropriate ledger accounts (use the T account format illustrated inExhibit 3–8 on page 108).c. Prepare a trial balance dated September 30, 2011. Assume accounts with zero balances are notincluded in the trial balance.
The McMillan Corporation incorporated on September 2, 2011. The company engaged in the
following transactions during its first month of operations:
Sept. 2 Issued capital stock in exchange for $900,000 cash.
Sept. 4 Purchased land and a building for $350,000. The value of the land was $50,000, and
the value of the building was $300,000. The company paid $200,000 cash and issued a
note payable for the balance.
Sept. 12 Purchased office supplies for $600 on account. The supplies will last for several
months.
Sept. 19 Billed clients $75,000 on account.
Sept. 29 Recorded and paid salary expense of $24,000.
Sept. 30 Received $30,000 from clients billed on September 19.
A partial list of the account titles used by the company includes:
Cash Notes Payable
Accounts Receivable Accounts Payable
Offi ce Supplies Capital Stock
Land Client Revenue
Building Salary Expense
a. Prepare
b. Post each entry to the appropriate ledger accounts (use the T account format illustrated in
Exhibit 3–8 on page 108).
c. Prepare a
included in the trial balance.
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