Following are the transactions for Valdez Services.The company paid $500 cash for payment on a 3-month-old account payable for office supplies.The company paid $2,200 cash for the just-completed two-week salary of the receptionist.The company paid $42,000 cash for equipment purchased.The company paid $200 cash for this month’s utilities.The company paid a $10,500 cash dividend to the owner (sole shareholder).1. Prepare general journal entries for the above transactions of Valdez Services.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. Listed below are three reasons why a transaction would not result in an expense. Match each of the reasons to the transaction it properlydescribes.ReasonThis transaction is a distribution of cash to the owner. Even though equity decreased, that decrease did not occur in the process ofproviding goods or services to customers.This transaction decreased cash in settlement of a previously existing liability (equity did not change). Supplies expense is recorded whenassets 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 didequity).Transaction

Name: Following are the transactions for Valdez Services.The company paid $5
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Description: Following are the transactions for Valdez Services.The company paid $500 cash for payment on a 3-month-old account payable for office supplies.The company paid $2,200 cash for the just-completed two-week salary of the receptionist.The company paid $4

A journal entry is a process of recording or maintaining track of any financial or non-financial…

Answered: Following are the transactions for…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Following are the transactions for Valdez Services.

The company paid $500 cash for payment on a 3-month-old account payable for office supplies.
The company paid $2,200 cash for the just-completed two-week salary of the receptionist.
The company paid $42,000 cash for equipment purchased.
The company paid $200 cash for this month’s utilities.
The company paid a $10,500 cash dividend to the owner (sole shareholder).

1. Prepare general journal entries for the above transactions of Valdez Services.
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.

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 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.
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

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