College Accounting (Book Only): A Career Approach
13th Edition
ISBN: 9781337280570
Author: Scott, Cathy J.
Publisher: South-Western College Pub
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Textbook Question
Chapter 1, Problem 4PA
On March 1 of this year, B. Gervais established Gervais Catering Service. The account headings are presented below. Transactions completed during the month follow. 
- a. Gervais deposited $25,000 in a bank account in the name of the business.
- b. Bought a truck from Kelly Motors for $26,329, paying $8,000 in cash and placing the balance on account, Ck. No. 500.
- c. Bought catering equipment on account from Luigi’s Equipment, $3,795.
- d. Paid the rent for the month, $1,255, Ck. No. 501.
- e. Bought insurance for the truck for one year, $400, Ck. No. 502.
- f. Sold catering services for cash for the first half of the month, $3,012.
- g. Bought supplies for cash, $185, Ck. No. 503.
- h. Sold catering services on account, $4,307.
- i. Received and paid the heating bill, $248, Ck. No. 504.
- j. Received a bill from GC Gas and Lube for gas and oil for the truck, $128.
- k. Sold catering services for cash for the remainder of the month, $2,649.
- l. Gervais withdrew cash for personal use, $1,550, Ck. No. 505.
- m. Paid the salary of the assistant, $1,150, Ck. No. 506.
Required
- 1. Record the transactions and the balance after each transaction.
- 2. Total the left side of the
accounting equation (left side of the equal sign), then total the right side of the accounting equation (right side of the equal sign). If the two totals are not equal, check the addition and subtraction. If you still cannot find the error, re-analyze each transaction.
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July 3 He purchases shop fittings for sh. 2,500 and pays by cheque.
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July 30…
S. Waweru starts business on 1st July 2020, when he deposits Shs. 18,000 into his business bank account and Shs. 2,500 in his cash account. During the month of July, he undertakes the following transactions:-
2020
July 3 He purchases shop fittings for sh. 2,500 and pays by cheque.
July 4 He buys a motor vehicle from AB & Co. on credit Sh. 3,000.
July 6 He buys stock for Sh. 1,500 and pays through bank.
July 8 He sells goods for cash Sh.1,000.
July 10 Buys goods on credit from XY & Co. for Sh. 1,200
July 12 Sells goods to A. Smith for Sh. 900 on credit
July 13 Pays wages Sh. 120 by cash
July 14 A. Smith returns goods worth Sh. 200
July 15 Pays to AB & Co. Sh. 3,000 by cheque
July 17 Goods returned to XY & Co. amounting to Sh. 350
July 21 Receives from A. Smith a cheque for Sh. 700
July 25 Sells goods for cash Sh. 300.
July 30…
Prepare the following journal entry, all transactions that occurred in January:
The Corporation purchased a Delivery Van for customer deliveries. The Delivery Van cost $21,400.
A down payment of cash in the amount of $5,000 was paid to the Car Dealership, and a promissory note was signed for the remaining amount owed.
Chapter 1 Solutions
College Accounting (Book Only): A Career Approach
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