Question

C. R. Byrd invests his business in an advertising company called Pioneer Advertising Agency. All transaction in the first of his biasness: 1- Transaction : On October 1, C. R. Byrd invests $10,000 cash in an advertising company called Pioneer Advertising Agency 2- Transaction: On October 1, Pioneer purchases office equipment costing $5,000 by signing a 3-month, 12%, $5,000 note payable. 3. Transaction: On October 2, Pioneer receives a $1,200 cash advance from R. Knox, a client, for advertising services that are expected to be completed by December 31. 4 Transaction: On October 3, Pioneer pays office rent for October in cash, $900. 5- Transaction: On October 4, Pioneer pays $600 for a one-year insurance policy that will expire next year on September 30. 6- Transaction: On October 5, Pioneer purchases an estimated 3-month supply of advertising materials on account from Aero Supply for $2,500. 7- Transaction: On October 9, Pioneer hires four employees to begin work on October 15. Each employee is to receive a weekly salary of $500 for a 5-day work week, payable every 2 weeks first payment made on October 26. 8- Transaction : On October 20, C. R.Byrd withdraws $500 cash for personal use 9- Transaction: On October 26, Pioneer owes employee salaries of $4,000 and pays them in cash. (See October 9 transaction) 10- Transaction : On October 31, Pioneer receives $10,000 in cash from Copa Company for advertising services provided in October Required 1- Record journalizing and general journal all transactions (Journal and General Journal) 2- Post all transactions to the ledger (General Ledger) 3- Prepare the trial Balance (Trial Balance)

Answer 1

1. Journal Entries -

Date Credit Pioneer Advertising Agency Journal Entries Accounts Title Debit Cash $ 10,000 C. R. Byrd, Capital (Being Cash invested in the business) Oct 1 $ 10,000 Oct 1 Office Equipment $ 5,000 Notes Payable $ 5,000 (Being Equipment puchased and noted issued) Oct 2 Cas $ 1,200 Unearned Revenue (Being Cash received as advance) $ 1,200 Oct 3 900 Rent expense $ Cash (Being Rent expense paid) $ 900 Oct 4 Prepaid Insurance $ 600 Cash (Being Insurance Expense paid for 1 year) $ 600 Oct 5 Supplies $ 2,500 Accounts Payable $ 2,500 (Being Advertising Supplies Purchased on account) Oct 9 No Entry Oct 20 C. R. Byrd, Withdrawal $ 500 Cash (Being cash withdraw for personal use) $ 500 Oct 26 Salaries Expense $ 4,000 Cash (Being Salaries expense paid) $ 4,000 Oct 31 Cash $ 10,000 Advertising Service Revenue (Being Cash received on service provided) $ 10,000

2. Ledgers -

Cash Notes Payable Oct 1 Oct 1 $ 5,000 Oct 2 Oct 31 $ 10,000 $ 1,200 $ 10,000 Oct 3 Oct 4 Oct 20 Oct 26 $ 900 $ 600 $ 500 $ 4,000 Oct 31 $ 5,000 Oct 31 $ 15,200 C. R. Byrd, Capital Oct 1 $ 21,200 $ 21,200 $ 10,000 Oct 31 $ 10,000 Prepaid Insurance $ 600 Oct 4 Oct 31 $ 600 C. R. Byrd, withdrawal $ 500 Oct 20 Oct 31 $ 500 Supplies $ 2,500 Oct 5 Oct 31 $ 2,500 Advertising Service Revenue Oct 31 $ 10,000 Office Equipment $ 5,000 Oct 1 Oct 31 $ 10,000 Oct 31 $ 5,000 Salaries Expense $ 4,000 Oct 26 Accounts Payable Oct 5 $ 2,500 Oct 31 $ 4,000 Oct 31 $ 2,500 Rent expense 900 Oct 3 $ Unearned Revenue Oct 2 $ 1,200 Oct 31 $ 900 Oct 31 $ 1,200

3. Trial Balance -

Credit Pioneer Advertising Agency Trial Balance Accounts Title Debit Cash $ 15,200 Prepaid Insurance $ 600 Supplies $ 2,500 Office Equipment $ 5,000 Accounts Payable Unearned Revenue Notes Payable C. R. Byrd, Capital C. R. Byrd, Withdrawal $ 500 Advertising Service Revenue Salaries Expense $ 4,000 Rent expense $ 900 $ 2,500 $ 1,200 $ 5,000 $ 10,000 $ $ 10,000 Total $ 28,700 $ 28,700