Traf Enterprises incorporated on May 3, 2011. The company engaged in the following transactions during its first month of operations: May 3 Issued capital stock in exchange for $800,000 cash. May 4 Paid May office rent expense of $1,000. May 5 Purchased office supplies for $400 cash. May 15 Purchased office equipment for $8,000 on account. May 18 Purchased a company car for $27,000. Paid $7,000 cash and issued a note payable forthe remaining amount owed. May 20 Billed clients $32,000 on account. May 26 Declared a $5,000 dividend; distributed to shareholders on June 26. May 29 Paid May utilities of $200. May 30 Received $30,000 from clients billed on May 20. May 31 Recorded and paid salary expense of $14,000. Apply concept of financial accounting : a. Prepare journal entries, including explanations, for the above transactions. b. Post each entry to the appropriate ledger accounts (T accounts). c. Prepare a trial balance dated May 31, 2011.
Traf Enterprises incorporated on May 3, 2011. The company engaged in the following transactions
during its first month of operations:
May 3 Issued capital stock in exchange for $800,000 cash.
May 4 Paid May office rent expense of $1,000.
May 5 Purchased office supplies for $400 cash.
May 15 Purchased office equipment for $8,000 on account.
May 18 Purchased a company car for $27,000. Paid $7,000 cash and issued a note payable forthe remaining amount owed.
May 20 Billed clients $32,000 on account.
May 26 Declared a $5,000 dividend; distributed to shareholders on June 26.
May 29 Paid May utilities of $200.
May 30 Received $30,000 from clients billed on May 20.
May 31 Recorded and paid salary expense of $14,000.
Apply concept of financial accounting :
a. Prepare
b.
c. Prepare a
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