Following are the transactions for Valdez Services. a. The company paid $2,000 cash for payment on a 6-month-old account payable for office supplies. b. The company paid $1,200 cash for the just completed tvwo-week salary of the receptionist. c. The company paid $39.000 cash for equipment purchased. d. The company paid $800 cash for this month's utilities. e. The owner (B. Valdez) withdrew $4,500 cash from the company for personal use. 1. Prepare general journal entries for the above transactions of Valdez Services. View journal entry worksheet View transaction list No Transaction General Journal Debit Credit | Accounts payable 2,000 Cash 2,000 b. Salaries expense 1,200 Cash 1,200 3 Equipment 30,000 C. Cash 30,000 d. Utilities expense 800 4 Cash 800 B. Valdez, Withdrawals Cash e. 4,500 4,500 2. Listed below are three reasons why a transaction would not result in an expense. Match each of the reasons to the transaction it properly describes. Reason This transaction is a distribution of cash to the owner. Even though equity decreased, that decrease did not ocour in the process of providing goods or services to customers. This transaction decreased cash in settlement of a previously existing liability (equity did not change). Supplies expense is recorded when assets are used, not necessarily when cash is paid. This transaction involves the purchase of an asset. The form of the company's assets changed, but total assets did not (and neither did equity) Transaction a.
Following are the transactions for Valdez Services. a. The company paid $2,000 cash for payment on a 6-month-old account payable for office supplies. b. The company paid $1,200 cash for the just completed tvwo-week salary of the receptionist. c. The company paid $39.000 cash for equipment purchased. d. The company paid $800 cash for this month's utilities. e. The owner (B. Valdez) withdrew $4,500 cash from the company for personal use. 1. Prepare general journal entries for the above transactions of Valdez Services. View journal entry worksheet View transaction list No Transaction General Journal Debit Credit | Accounts payable 2,000 Cash 2,000 b. Salaries expense 1,200 Cash 1,200 3 Equipment 30,000 C. Cash 30,000 d. Utilities expense 800 4 Cash 800 B. Valdez, Withdrawals Cash e. 4,500 4,500 2. Listed below are three reasons why a transaction would not result in an expense. Match each of the reasons to the transaction it properly describes. Reason This transaction is a distribution of cash to the owner. Even though equity decreased, that decrease did not ocour in the process of providing goods or services to customers. This transaction decreased cash in settlement of a previously existing liability (equity did not change). Supplies expense is recorded when assets are used, not necessarily when cash is paid. This transaction involves the purchase of an asset. The form of the company's assets changed, but total assets did not (and neither did equity) Transaction a.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Following are the transactions for Valdez Services.
a. The company paid $2,000 cash for payment on a 6-month-old account payable for office supplies.
b. The company paid $1,200 cash for the just completed two-week salary of the receptionist.
c. The company paid $39.000 cash for equipment purchased.
d. The company paid $800 cash for this month's utilities.
e. The owner (B. Valdez) withdrew $4,500 cash from the company for personal use.
1. Prepare general journal entries for the above transactions of Valdez Services.
View transaction list
View journal entry worksheet
No
Transaction
General Journal
Debit
Credit
1
Accounts payable
2,000
a.
Cash
2,000
2
b.
Salaries expense
1,200
Cash
1,200
3
Equipment
39,000
C.
Cash
39,000
4
d.
Utilities expense
800
Cash
800
B. Valdez, Withdrawals
4,500
e.
Cash
4,500
2. Listed below are three reasons why a transaction would not result in an expense. Match each of the reasons to the transaction it
properly describes.
Reason
Transaction
This transaction is a distribution of cash to the owner. Even though equity decreased, that decrease did not occur
in the process of providing goods or services to customers.
This transaction decreased cash in settlement of a previously existing liability (equity did not change). Supplies
expense is recorded when assets are used, not necessarily when cash is paid.
le.
a.
This transaction involves the purchase of an asset. The form of the company's assets changed, but total assets
did not (and neither did equity).-
C.
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