Question & Answer: rnal entries for each of the following January activities, and post results to the…..

Geo Inc. had the following account balances on January 1, Year 2:


Accounts Payable	$	707
Accounts Receivable		1,600
Cash		1,600
Common Stock		15,000
Equipment		1,700
Note Payable		3,000
Retained Earnings		3,661
Salaries and Wages Expense		4,100
Supplies		820

Required:

Prepare journal entries for each of the following January activities, and post results to the relevant T-accounts. Compute the ending balance of each T-account. Beginning balances have been entered. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.)

A.	Paid $707 on account for utilities that were used during December Year 1.
B.	Purchased $453 of supplies for cash.
C.	Signed a rental agreement for office space and paid $4,700 in advance for six months of rent beginning February 1, Year 2.
D.	Purchased $14,500 of new equipment, signing a promissory note.
E.	Provided $29,000 of services. $18,000 was received in cash and $11,000 was provided on credit.
F.	Paid workers $6,000 for work done in January.

Expert Answer


Journal Entries				T-Accounts
Transaction No.	Account Titles	Debit	Credit	Accounts Payable
A	Accounts Payable	$707		Debit Side	Amount	Credit Side	Amount
	Cash		$707	To Cash	$707	By balance b/d	$707

B	Supplies	$453
	Cash		$453	Total	$707	Total	$707

C	Prepaid Office Rent	$4,700		Accounts Receivable
	Cash		$4,700	Debit Side	Amount	Credit Side	Amount
				To balance b/d	$1,600
D	Equipment	$14,500		To Service Revenue	$11,000
	Note Receivable		$14,500			By balance c/f	$12,600
				Total	$12,600	Total	$12,600
E	Cash	$18,000
	Accounts Receivable	$11,000		Cash
	Service Revenue		$29,000	Debit Side	Amount	Credit Side	Amount
				To balance b/d	$1,600	By Accounts Payable	$707
E	Salaries and Wages Expense	$6,000		To Service Revenue	$18,000	By Supplies	$453
	Cash		$6,000			By Prepaid Office Rent	$4,700
						By Salaries and Wages Expense	$6,000


						By balance c/f	$7,740
				Total	$19,600	Total	$19,600

				Common Stock
				Debit Side	Amount	Credit Side	Amount
						By balance b/d	$15,000

				To balance c/f	$15,000
				Total	$15,000	Total	$15,000

				Equipment
				Debit Side	Amount	Credit Side	Amount
				To balance b/d	$1,700
				To Note Receivable	$14,500
						By balance c/f	$16,200
				Total	$16,200	Total	$16,200

				Note Payable
				Debit Side	Amount	Credit Side	Amount
						By balance b/d	$3,000

				To balance c/f	$3,000
				Total	$3,000	Total	$3,000

				Retained Earnings
				Debit Side	Amount	Credit Side	Amount
						By balance b/d	$3,661

				To balance c/f	$3,661
				Total	$3,661	Total	$3,661

				Salaries and Wages Expenses
				Debit Side	Amount	Credit Side	Amount
				To balance b/d	$4,100
				To Cash	$6,000
						By balance c/f	$10,100
				Total	$10,100	Total	$10,100

				Supplies
				Debit Side	Amount	Credit Side	Amount
				To balance b/d	$820
				To Cash	$453
						By balance c/f	$1,273
				Total	$1,273	Total	$1,273

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