Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
ISBN: 9781337690881



Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
ISBN: 9781337690881
Textbook Problem

Problem 2-59A Journalizing Transactions

Monroe Company rents and sells electronic equipment. During September, Monroe engaged in the transactions described below.

Sept. 5 Purchased a Chevrolet truck for $38,900 cash.

8 Purchased inventory for $4200 on account.

10 Purchased $1,250 of office supplies on credit.

11 Rented sound equipment to a traveling stage play for $13,600. The producer of the play paid for the service at the time it was provided.

Sept 12 Rented sound equipment and lights to a local student organization for a school dance for $2,400. The student organization will pay for services within 30 days.

18 Paid employee wages of $4,750. What have been earned during September.

22 Collected the receivable from the September 12 transaction.

23 Borrowed $20000 cash from a bank on a 3-year note payable.

28 Issued common stock to new stockholders for $35,000.

30 Paid a $3,250 cash dividend to stock-holders


Prepare a journal entry for each transaction.

To determine

Journal Entries:

Journal entries are medium of recording business transactions. A business enterprise must record all the business transaction to evaluate net income or loss and analyze the financial performance of a company during a specified accounting period.

Journalize the transactions which occurred during the month of January.

    Date AssetsLiabilitiesStockholders’ Equity
    5Increase (Truck)
    Decrease (Cash)
    8Increase (Merchandise Inventory)Increase (Accounts Payable)
    10Increase (Supplies)Increase (Accounts Payable)
    11Increase (Cash)Increase (Service Revenue)
    12Increase (Accounts Receivable)

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