Connect Financial Accounting Chapter 2

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Connect Financial Accounting Chapter 2

Q1. Following are the transactions of a new company called Pose-for-Pics.

  • Aug 1 – Madison Harris, the owner, invested $12,500 cash and $53,750 of photography equipment in the company in exchange for common stock.
  • Aug 2 – The company paid $3,700 cash for an insurance policy covering the next 24 months.
  • Aug 5 – The company purchased office supplies for $2,375 cash.
  • Aug 20 – The company received $2,650 cash in photography fees earned.
  • Aug 31 – The company paid $883 cash for August utilities.

Prepare general journal entries for the above transactions.

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Q2. The transactions of Spade Company appear below.

  • Kacy Spade, owner, invested $20,000 cash in the company in exchange for common stock.
  • The company purchased office supplies for $580 cash.
  • The company purchased $11,060 of office equipment on credit.
  • The company received $2,360 cash as fees for services provided to a customer.
  • The company paid $11,060 cash to settle the payable for the office equipment purchased in transaction c.
  • The company billed a customer $4,240 as fees for services provided.
  • The company paid $520 cash for the monthly rent.
  • The company collected $1,781 cash as partial payment for the account receivable created in transaction f.
  • The company paid $1,100 cash in dividends to the owner (sole shareholder).

Required:
1.
Prepare general journal entries to record the transactions above for Spade Company by using the following accounts: Cash; Accounts Receivable; Office Supplies; Office Equipment; Accounts Payable; Common Stock; Dividends; Fees Earned; and Rent Expense. Use the letters beside each transaction to identify entries.

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2. Post the above journal entries to T-accounts, which serve as the general ledger for this assignment.

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Q3. The transactions of Spade Company appear below.

  • Kacy Spade, owner, invested $19,000 cash in the company in exchange for common stock.
  • The company purchased office supplies for $551 cash.
  • The company purchased $10,507 of office equipment on credit.
  • The company received $2,242 cash as fees for services provided to a customer.
  • The company paid $10,507 cash to settle the payable for the office equipment purchased in transaction c.
  • The company billed a customer $4,028 as fees for services provided.
  • The company paid $535 cash for the monthly rent.
  • The company collected $1,692 cash as partial payment for the account receivable created in transaction f.
  • The company paid $900 cash in dividends to the owner (sole shareholder).

Prepare the Trial Balance.

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