Question

Karla Tanner opened a Web consulting business called Linkworks and completed the following transactions in its first month of operations April 1 Tanner invested $95,000 cash along with office equipment valued at $22,800 in the company in exchange for common stock 2 The company prepaid $7,200 cash for 12 months' rent for office space. Hint: Debit Prepaid Rent for $7,200. 3 The company made credit purchases for $11,490 in office equipment and $2,280 in office supplies. Payment is due within 10 days. 6 The company completed services for a client and immediately received $2,000 cash. 9 The company completed a $7,600 project for a client, who must pay within 30 days. 13 The company paid $13, 680 cash to settle the account payable created on April 3. 19 The company paid $6,000 cash for the premium on a 12-month insurance policy. Hint: Debit Prepaid Insurance for $6,000 22 The company received $6,000 cash as partial payment for the work completed on April 9. 25 The company completed work for another client for $2,648 on credit. 28 The company paid a $6,200 cash dividend. 29 The company purchased $760 of additional office supplies on credit. 30 The company paid $700 cash for this month's utility bill. Required: 1. Prepare general journal entries to record these transactions using the following titles: Cash (101): Accounts Receivable (106): Office Supplies (124); Prepaid Insurance (128): Prepaid Rent (131: Office Equipment (163); Accounts Payable (201): Common Stock (307): Dividends (319): Services Revenue (403); and Utilities Expense (690). 2. Post the journal entries from part 1 to the ledger accounts. 3. Prepare a trial balance as of April 30. Prey 1 of 4 ! Next > → c o o $ 4 % 5 & 7 3 6 8. 9 0

Answer 1

Req 1

Date	General Journal	Debit	Credit
Apr-01	Cash	95,000
	Office equipment	22,800
	Common stock		117,800
Apr-02	Prepaid rent	7,200
	Cash		7,200
Apr-03	Office equipment	11,400
	Office supplies	2,280
	Accounts payable		13,680
Apr-06	Cash	2,000
	Services revenue		2,000
Apr-09	Accounts receivable	7,600
	Services revenue		7,600
Apr-13	Accounts payable	13,680
	Cash		13,680
Apr-19	Prepaid insurance	6,000
	Cash		6,000
Apr-22	Cash	6,080
	Accounts receivable		6,080
Apr-25	Accounts receivable	2,640
	Services revenue		2,640
Apr-28	Dividends	6,200
	Cash		6,200
Apr-29	Office supplies	760
	Accounts payable		760
Apr-30	Utilities expense	700
	Cash		700

Req 2

Cash
Date	Debit	Credit	Balance
Apr-01	95,000		95,000
Apr-02		7,200	87,800
Apr-06	2,000		89,800
Apr-13		13,680	76,120
Apr-19		6,000	70,120
Apr-22	6,080		76,200
Apr-28		6,200	70,000
Apr-30		700	69,300
Accounts Receivable
Date	Debit	Credit	Balance
Apr-09	7,600		7,600
Apr-22		6,080	1,520
Apr-25	2,640		4,160
Office Supplies
Date	Debit	Credit	Balance
Apr-03	2,280		2,280
Apr-29	760		3,040
Prepaid Insurance
Date	Debit	Credit	Balance
Apr-19	6,000		6,000
Prepaid Rent
Date	Debit	Credit	Balance
Apr-02	7,200		7,200
Office Equipment
Date	Debit	Credit	Balance
Apr-01	22,800		22,800
Apr-03	11,400		34,200
Accounts Payable
Date	Debit	Credit	Balance
Apr-03		13,680	13,680
Apr-13	13680		0
Apr-29		760	760
Common Stock
Date	Debit	Credit	Balance
Apr-01		117,800	117,800
Dividends
Date	Debit	Credit	Balance
Apr-28	6,200		6,200
Service Revenue
Date	Debit	Credit	Balance
Apr-06		2,000	2,000
Apr-09		7,600	9,600
Apr-25		2,640	12,240
Utilities Expense
Date	Debit	Credit	Balance
Apr-30	700		700

Req 3

Linkworks
Trial Balance
Apr-30
	Debit	Credit
Cash	69,300
Accounts receivable	4,160
Office supplies	3,040
Prepaid insurance	6,000
Prepaid rent	7,200
Office equipment	34,200
Accounts payable		760
Common stock		117,800
Dividends	6,200
Services revenue		12,240
Utilities expense	700
Totals	130,800	130,800

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