Chapter 2, Problem 2.4BP

Record transactions (LO2–4)

Flip Side of P2–5B

Eli owns an insurance office, while Olivia operates a maintenance service that provides basic custodial duties. For the month of May, the following transactions occurred.

  May 2    Olivia decides that she will need insurance for a one-day special event at the end of the month and pays Eli $300 in advance.

  May 5    Olivia provides maintenance services to Eli’s insurance offices on account, $425.

  May 7    Eli borrows $500 from Olivia by signing a note.

  May 14    Olivia purchases maintenance supplies from Spot Corporation, paying cash of $200.

  May 19    Eli pays $425 to Olivia for maintenance services provided on May 5.

  May 25    Eli pays the utility bill for the month of May, $135.

  May 28    Olivia receives insurance services from Eli equaling the amount paid on May 2.

  May 31    Eli pays $500 to Olivia for money borrowed on May 7.

Required:

Record each transaction for Eli’s Insurance Services. Keep in mind that Eli may not need to record each transaction.