Explanation Journal entry : Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically. Accounting rules for Journal entries : To record increase balance of account : Debit assets, expenses, losses and credit liabilities, capital, revenue and gains. To record decrease balance of account : Credit assets, expenses, losses and debit liabilities, capital, revenue and gains. T-account: T-account is the form of the ledger account, where the journal entries are posted to this account. It is referred to as the T-account, because the alignment of the components of the account resembles the capital letter ‘T’. Trial balance: Trial balance is the summary of accounts, and their debit and credit balances at a given time. It is usually prepared at end of the accounting period. Debit balances are listed in left column and credit balances are listed in right column. The totals of debit and credit column should be equal. Trial balance is useful in the preparation of the financial statements. Prepare journal entries for the given transactions: Date Account Title and Explanation Debit ($) Credit ($) December 1 Cash 20,000 Common Stock 20,000 (To record the issuance of common stock) Table (1) Date Account Title and Explanation Debit ($) Credit ($) December 2 Rent Expense 1,100 Cash 1,100 (To record the payment of rent expense) Table (2) Date Account Title and Explanation Debit ($) Credit ($) December 3 Office Equipment 2,900 Accounts Payable 2,900 (To record the purchase of office equipment on account) Table (4) Date Account Title and Explanation Debit ($) Credit ($) December 4 Office Supplies 1,700 Cash 1,700 (To record the purchase of office supplies on cash) Table (5) Date Account Title and Explanation Debit ($) Credit ($) December 5 Accounts Receivable 7,300 Serv...

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ISBN: 9781618530400

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Publisher: Cambridge

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Chapter 2, Problem 13AE

To determine

Prepare journal entries, record the following transactions in the T-accounts, calculate the balance in each account and prepare trial balance.

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Chapter 2, Problem 12AE

Chapter 2, Problem 14AE

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Chapter 2 Solutions

Financial Accounting for Undergraduates

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