Journal Entry : It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health. 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. Credit Card: It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash. Perpetual Inventory System: It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred. To prepare: Journal entries for the given credit card sales transactions.

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Answer 1

Question

Chapter 7, Problem 2E

To determine

Journal Entry:

It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health.

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.

Credit Card:

It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash.

Perpetual Inventory System:

It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred.

To prepare: Journal entries for the given credit card sales transactions.

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Answer 2

Question

Chapter 7, Problem 2E

To determine

Journal Entry:

It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health.

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.

Credit Card:

It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash.

Perpetual Inventory System:

It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred.

To prepare: Journal entries for the given credit card sales transactions.

Expert Solution & Answer

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Answer 3

Question

Chapter 7, Problem 2E

To determine

Journal Entry:

It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health.

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.

Credit Card:

It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash.

Perpetual Inventory System:

It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred.

To prepare: Journal entries for the given credit card sales transactions.

Expert Solution & Answer

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Answer 4

Question

Chapter 7, Problem 2E

To determine

Journal Entry:

It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health.

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.

Credit Card:

It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash.

Perpetual Inventory System:

It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred.

To prepare: Journal entries for the given credit card sales transactions.

Expert Solution & Answer

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Answer 5

Chapter 7, Problem 2E

To determine

Journal Entry:

It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health.

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.

Credit Card:

It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash.

Perpetual Inventory System:

It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred.

To prepare: Journal entries for the given credit card sales transactions.

Answer 6

Chapter 7, Problem 2E

To determine

Journal Entry:

It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health.

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.

Credit Card:

It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash.

Perpetual Inventory System:

It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred.

To prepare: Journal entries for the given credit card sales transactions.

Answer 7

Chapter 7, Problem 2E

To determine

Journal Entry:

It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health.

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.

Credit Card:

It refers to the card made of plastic and issued by a bank. It provides an individual to buy goods and services on credit when they have shortage of cash.

Perpetual Inventory System:

It refers to the system of recording transaction related to inventories at the time of their occurrence. Each sale and purchase is recorded at the time they occurred.

To prepare: Journal entries for the given credit card sales transactions.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 7 - Prob. 1MCQ Ch. 7 - Prob. 2MCQ Ch. 7 - Prob. 3MCQ Ch. 7 - Prob. 4MCQ Ch. 7 - Prob. 5MCQ Ch. 7 - Prob. 1DQ Ch. 7 - Prob. 2DQ Ch. 7 - Prob. 3DQ Ch. 7 - Prob. 4DQ Ch. 7 - Prob. 5DQ

Solution Summary: The author explains the rules for journal entry, which are defined by 5 accounting components, such as Assets, Liabilities, and Revenue.

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