1

On October 1, 2019, Helen Kennedy opened an advertising agency.

  
DATE TRANSACTIONS
Oct. 1Helen Kennedy invested $57,000 cash in the business.
2Paid October office rent of $2,850; issued Check 1001.
5Purchased desks and other office furniture for $14,700 from Office Furniture Mart,
Inc.; received Invoice 6704 payable in 60 days.
6Issued Check 1002 for $3,050 to purchase art equipment.
7Purchased supplies for $1,400; paid with Check 1003.
10Issued Check 1004 for $570 for office cleaning service.
12Performed services for $3,950 in cash and $1,750 on credit. (Use a compound entry.)
15Returned damaged supplies for a cash refund of $370.
18Purchased a computer for $2,850 from Office Furniture Mart, Inc., Invoice 7108;
issued Check 1005 for a $1,675 down payment, with the balance payable in 30 days.
(Use one compound entry.)
20Issued Check 1006 for $7,350 to Office Furniture Mart, Inc., as payment on account
for Invoice 6704.
26Performed services for $4,250 on credit.
27Paid $310 for monthly telephone bill; issued Check 1007.
30Received $3,550 in cash from credit customers.
30Mailed Check 1008 to pay the monthly utility bill of $385.
30Issued Checks 1009–1011 for $7,850 for salaries.

Required:
1. Journalize the above transactions.
2. Post the above transactions to the ledger accounts.
 
Analyze:
What is the balance of account 202 in the general ledger?
2
The transactions that follow took place at the Desoto Recreation and Sports Arena during
September 2019. This firm has indoor courts where customers can play tennis for a fee. It also
rents equipment and offers tennis lessons.
 
DATE TRANSACTIONS
Sept. 1Issued Check 1169 for $1,200 to pay the September rent.
  5Performed services for $3,200 in cash.
  6Performed services for $2,050 on credit.
  10Paid $560 for monthly telephone bill; issued Check 1170.
  11Paid for equipment repairs of $800 with Check 1171.
  12Received $3,000 on account from credit clients.
  15Issued Checks 1172–1177 for $4,000 for salaries.
  18Issued Check 1178 for $1,800 to purchase supplies.
19Purchased new tennis rackets for $2,050 on credit from The Tennis Supply Shop;
 
received Invoice 3108, payable in 30 days.
  20Issued Check 1179 for $2,720 to purchase new nets. (Equip.)
  21Received $910 on account from credit clients.
  21Returned a damaged net and received a cash refund of $410.
  22Performed services for $3,400 in cash.
  23Performed services for $4,990 on credit.
  26Issued Check 1180 for $600 to purchase supplies.
  28Paid the monthly electric bill of $2,390 with Check 1181.
  30Issued Checks 1182–1187 for $4,000 for salaries.
  30Issued Check 1188 for $4,000 cash to Ellis Carter for personal expenses.

Required:
Record each of the above transactions in the general journal. 

Analyze:
If the company paid a bill for supplies on October 1, what check number
would be included in the journal entry description?
3
The following journal entries were prepared by an employee of
International Marketing Company who does not have an adequate
knowledge of accounting.
 
GENERAL JOURNAL PAGE 3
Date Description Post. Ref. Debit Credit
2019        
April1Accounts Payable   14,300  
  Fees Income     14,300
    Performed services on credit      
          
  2Cash   690  
  Telephone Expense     690
    Paid for March telephone service, Check 1917      
          
  3Office Equipment   8,720  
    Office Supplies   990  
  Cash     10,300
    Purchased file cabinet and office supplies, Check 1918      

(Assume that Office Equipment and Office Supplies were recorded at the
correct values.)

Required:
Examine the above journal entries carefully and prepare
the correcting journal entries.

Analyze:
After the correcting journal entries have been posted, what effect do the
corrections have on the company’s reported assets?