The following transactions occurred at Chicken King Restaurant: a. Purchased new fryer equipment with a banknote b. Paid wages from cash c. Sales for the month in cash d. Paid postage for a promotional mailing on account e. Paid rent for the current month and also for next month out of cash f. Paid utility expense g. Sales to customers on account REQUIRED: For each of the transactions, state which accounts are affected, state the normal balance for each account, and indicate whether the transaction is a debit or credit to that account. Set up your answers in columns, as indicated below. Accounts Affected
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
The following transactions occurred at Chicken King Restaurant:
a. Purchased new fryer equipment with a banknote
b. Paid wages from cash
c. Sales for the month in cash
d. Paid postage for a promotional mailing on account
e. Paid rent for the current month and also for next month out of cash
f. Paid utility expense
g. Sales to customers on account
REQUIRED:
For each of the transactions, state which accounts are affected, state the normal balance for each account, and indicate whether the transaction is a debit or credit to that account. Set up your answers in columns, as indicated below.
Accounts Affected Normal Balance Debit or Credit
example ~ paid cash for office supplies
example: z cash debit credit
office supplies debit debit
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