Chapter 7, Problem 15E

To determine

Journal Entry:

It refers to the process of recording the data into books of accounts on continuous basis. It is a process of record keeping for every transaction by a company or a firm.

Rules of Journal Entry:

The rules for journal entry are defined by 5 accounting components,

• Assets: Increase in asset should be debit and decrease should be credit.
• Liabilities: Increase in liabilities should be credit and decrease should be debit.
• Equity: Increase in Equity should be credit and decrease should be debit.
• Expense: Increase in expense should be debit and decrease should be credit.
• Revenue: Increase in revenue should be credit and decrease should be debit.

Footnote:

It refers to the ending note which is represented at the end of a financial statement which shows the details of a transaction which does not have any monetary impact on the company and cannot be recorded in the any of the financial statement but which is important for the users for financial statements.

Accounts Receivable:

It refers to the amount that is to be received by a company for providing goods and services on credit. It is an asset account.

To prepare: Journal entries for given transactions on accounts receivables.