Exercise "2": Gary Bauer opens a computer consulting business called Technology Consultants and completes the fol- lowing transactions in April. April 1 Bauer invested $100,000 cash along with $24,000 in office equipment in the company. 2 The company prepaid $7,200 cash for twelve months' rent for an office. (Hint: Debit Prepaid Rent for $7,200.) 3 The company made credit purchases of office equipment for $12,000 and office supplies for $2,400. Payment is due within 10 days. 6 The company completed services for a client and immediately received $2,000 cash. 9 The company completed an $8,000 project for a client, who must pay within 30 days. 13 The company paid $14,400 cash to settle the account payable created on April 3. 19 The company paid S6,000 cash for the premium on a 12-month insurance policy. (Hint: Debit Prepaid Insurance for $6,000.) 22 The company received $6,400 cash as partial payment for the work completed on April 9. 25 The company completed work for another client for $2,640 on credit. 28 Bauer withdrew $6,200 cash from the company for personal use. 29 The company purchased $800 of additional office supplies on credit. 30 The company paid $700 cash for this month's utility bill. Required 1. Prepare general journal entries to record these transactions (use the account titles listed in part 2). 2. Open the following ledger accounts-their account numbers are in parentheses (use the balance col- umn format): Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); G. Bauer, Capital (301); G. Bauer, Withdrawals (302); Services Revenue (403); and Utilities Expense (690). Post the journal entries from part 1 to the ledger accounts and enter the balance after cach posting. 3.Prepare a trial balance.
Exercise "2": Gary Bauer opens a computer consulting business called Technology Consultants and completes the fol- lowing transactions in April. April 1 Bauer invested $100,000 cash along with $24,000 in office equipment in the company. 2 The company prepaid $7,200 cash for twelve months' rent for an office. (Hint: Debit Prepaid Rent for $7,200.) 3 The company made credit purchases of office equipment for $12,000 and office supplies for $2,400. Payment is due within 10 days. 6 The company completed services for a client and immediately received $2,000 cash. 9 The company completed an $8,000 project for a client, who must pay within 30 days. 13 The company paid $14,400 cash to settle the account payable created on April 3. 19 The company paid S6,000 cash for the premium on a 12-month insurance policy. (Hint: Debit Prepaid Insurance for $6,000.) 22 The company received $6,400 cash as partial payment for the work completed on April 9. 25 The company completed work for another client for $2,640 on credit. 28 Bauer withdrew $6,200 cash from the company for personal use. 29 The company purchased $800 of additional office supplies on credit. 30 The company paid $700 cash for this month's utility bill. Required 1. Prepare general journal entries to record these transactions (use the account titles listed in part 2). 2. Open the following ledger accounts-their account numbers are in parentheses (use the balance col- umn format): Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); G. Bauer, Capital (301); G. Bauer, Withdrawals (302); Services Revenue (403); and Utilities Expense (690). Post the journal entries from part 1 to the ledger accounts and enter the balance after cach posting. 3.Prepare a trial balance.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Exercise "2":
Gary Bauer opens a computer consulting business called Technology Consultants and completes the fol-
lowing transactions in April.
1 Bauer invested $100,000 cash along with $24,000 in office equipment in the company.
2 The company prepaid $7,200 cash for twelve months' rent for an offīice. (Hint: Debit Prepaid
Rent for $7,200.)
3 The company made credit purchases of office equipment for $12,000 and office supplies for
$2,400. Payment is due within 10 days.
6 The company completed services for a client and immediately received $2,000 cash.
9 The company completed an $8,000 project for a client, who must pay within 30 days.
13 The company paid $14,400 cash to settle the account payable created on April 3.
19 The company paid $6,000 cash for the premium on a 12-month insurance policy. (Hint: Debit
Prepaid Insurance for $6,000.)
22 The company received $6,400 cash as partial payment for the work completed on April 9.
25 The company completed work for another client for $2,640 on credit.
28 Bauer withdrew $6,200 cash from the company for personal use.
29 The company purchased $800 of additional office supplies on credit.
30 The company paid $700 cash for this month's utility bill.
April
Required
1. Prepare general journal entries to record these transactions (use the account titles listed in part 2).
2. Open the following ledger accounts-their account numbers are in parentheses (use the balance col-
umn format): Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128);
Prepaid Rent (131); Office Equipment (163); Accounts Payable (201); G. Bauer, Capital (301);
G. Bauer, Withdrawals (302); Services Revenue (403); and Utilities Expense (690). Post the journal
entries from part 1 to the ledger accounts and enter the balance after each posting.
3.Prepare a trial balance.
1
Financi
Part 1
Cash...
Office Equipment..
G. Bauer, Capital.
Owner invested cash and equipment.
April 1
100,000
24,000
124,000
2 Prepaid Rent...
Cash...
Prepaid twelve months' rent.
7,200
7,200
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