Karla Tanner opened a Web consulting business called Linkworks and completed the following transactions in its first month of operations. April 1 April 2 April 3 April 6 April 9 April 13 April 19 April 22 April 25 April 28 April 29 Tanner invested $105,000 cash along with office equipment valued at $25,200 in the company in exchange for common stock. The company prepaid $7,200 cash for 12 months' rent for office space. Hint: Debit Prepaid Rent for $7,200. The company made credit purchases for $12,600 in office equipment and $2,520 in office supplies. Payment is due within 10 days. The company completed services for a client and immediately received $2,000 cash. The company completed a $8,400 project for a client, who must pay within 30 days. The company paid $15,120 cash to settle the account payable created on April 3. The company paid $6,000 cash for the premium on a 12-month prepaid insurance policy. Hint: Debit Prepaid Insurance for $6,000. The company received $6,720 cash as partial payment for the work completed on April 9. The company completed work for another client for $2,640 on credit. The company paid a $6,200 cash dividend. The company purchased $840 of additional office supplies on credit.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Karla Tanner opened a Web consulting business called Linkworks and completed the following transactions in its first month of
operations.
April 1
April 2
April 3
April 6
April 9
April 13
April 19
Tanner invested $105,000 cash along with office equipment valued at $25,200 in the company in exchange for common stock.
The company prepaid $7,200 cash for 12 months' rent for office space. Hint: Debit Prepaid Rent for $7,200.
The company made credit purchases for $12,600 in office equipment and $2,520 in office supplies. Payment is due within 10
days.
The company completed services for a client and immediately received $2,000 cash.
The company completed a $8,400 project for a client, who must pay within 30 days.
The company paid $15,120 cash to settle the account payable created on April 3.
The company paid $6,000 cash for the premium on a 12-month prepaid insurance policy. Hint: Debit Prepaid Insurance for
$6,000.
The company received $6,720 cash as partial payment for the work completed on April 9.
The company completed work for another client for $2,640 on credit.
April 22
The company paid a $6,200 cash dividend.
April 25
April 28
April 29 The company purchased $840 of additional office supplies on credit.
April 30 The company paid $700 cash for this month's utility bill.
Required:
1. Prepare general journal entries to record these transactions using the following titles: Cash (101); Accounts Receivable (106):
Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131), Office Equipment (163); Accounts Payable (201); Common Stock
(307); Dividends (319); Services Revenue (403); and Utilities Expense (690).
2. Post the journal entries from part 1 to the ledger accounts.
3. Prepare a trial balance as of April 30.
Transcribed Image Text:Karla Tanner opened a Web consulting business called Linkworks and completed the following transactions in its first month of operations. April 1 April 2 April 3 April 6 April 9 April 13 April 19 Tanner invested $105,000 cash along with office equipment valued at $25,200 in the company in exchange for common stock. The company prepaid $7,200 cash for 12 months' rent for office space. Hint: Debit Prepaid Rent for $7,200. The company made credit purchases for $12,600 in office equipment and $2,520 in office supplies. Payment is due within 10 days. The company completed services for a client and immediately received $2,000 cash. The company completed a $8,400 project for a client, who must pay within 30 days. The company paid $15,120 cash to settle the account payable created on April 3. The company paid $6,000 cash for the premium on a 12-month prepaid insurance policy. Hint: Debit Prepaid Insurance for $6,000. The company received $6,720 cash as partial payment for the work completed on April 9. The company completed work for another client for $2,640 on credit. April 22 The company paid a $6,200 cash dividend. April 25 April 28 April 29 The company purchased $840 of additional office supplies on credit. April 30 The company paid $700 cash for this month's utility bill. Required: 1. Prepare general journal entries to record these transactions using the following titles: Cash (101); Accounts Receivable (106): Office Supplies (124); Prepaid Insurance (128); Prepaid Rent (131), Office Equipment (163); Accounts Payable (201); Common Stock (307); Dividends (319); Services Revenue (403); and Utilities Expense (690). 2. Post the journal entries from part 1 to the ledger accounts. 3. Prepare a trial balance as of April 30.
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