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week 1 E2-7 - Prepaid rent Cash 3 Sold goods to customers...

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E 2-7 Transaction analysis; debits and credits LO2 Some of the ledger accounts for the Sanderson Hardware Company are numbered and listed below. For each of the October 2006 transactions numbered 1 through 12 below, indicate by account which accounts should be debited and credited. The company uses the perpetual inventory system. Assume that appropriate adjusting entries were made at the end of September.
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Accounts payable Equipment Inventory Accounts receivable Cash Supplies Supplies expense Prepaid rent Sales revenue Retained earnings Note payable Common stock Unearned revenue Rent expense Wages payable Cost of goods sold Wage expense Interest expense Account(s) Debited Account(s) Credited Example:Purchased inventory for cash Inventory Cash 1. Paid a cash dividend. Retained earnings Cash 2. Paid rent for the next three months.
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Unformatted text preview: Prepaid rent Cash 3. Sold goods to customers on account. Accounts receivable Sales revenue Cost of goods sold Inventory 4. Purchased inventory on account. Inventory Accounts payable 5. Purchased supplies for cash. Supplies Cash 6. Paid employees wages for September. Wages payable Cash 7. Issued common stock in exchange for cash. Cash Common stock 8. Collected cash from customers for goods sold in 3. Cash Accounts receivable 9. Borrowed cash from a bank and signed a note. Cash Note payable 10. At the end of October, recorded the amount of supplies that had been used during the month. Supplies expense Supplies 11. Received cash for advance payment from customer. Cash Unearned revenue 12. Accrued employee wages for October. Wage expense Wages payable...
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