ACT3391BrushingUpOnAcctgCycle

ACT3391BrushingUpOnAcctgCycle - Date Account Debit Credit...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
The Accounting Cycle – Making Journal Entries Remember that when a recordable transaction occurs, a company will record the transaction via a Journal Entry . Journal entries are recorded to account for: 1. Cash collected/received 2. Cash disbursed/paid out 3. Purchases – cash or credit basis 4. Sales – cash or credit basis Examples of recordable transactions and the corresponding journal entries Acme issued common stock to investors in exchange for $100,000 Date Account Debit Credit Cash $100,000 Contributed Capital $100,000 Acme received $15,000 from customers for services that Acme provided on a cash basis Date Account Debit Credit Cash $15,000 Revenue $15,000 Acme collected $7,500 from customers for services that Acme had previously provided on a credit basis Date Account Debit Credit Cash $7,500 Accounts receivable $7,500
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Acme borrowed $500,000 from Second National Bank Date Account Debit Credit Cash $500,000 Notes payable $500,000 Acme purchased $50 of office supplies on a cash basis
Background image of page 2
Background image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Date Account Debit Credit Office supplies expense $50 Cash $50 Acme paid a supplier/vendor $100 for merchandise it previously purchased on credit basis Date Account Debit Credit Accounts payable $100 Cash $100 Acme paid back $200,000 of loan principle Date Account Debit Credit Notes payable $200,000 Cash $200,000 Acme incurred and paid $3,000 of wage expenses and $400 of utilities expenses Date Account Debit Credit Wages expense $3,000 Utilities expense $ 400 Cash $3,400 Acme $2,000 for next months office rent Date Account Debit Credit Prepaid rent $2,000 Cash $2,000 Acme purchased $50,000 of office furniture (a fixed asset) on a credit basis Date Account Debit Credit Office furniture $50,000 Accounts payable $50,000 Acme provided $18,000 of consulting services to a customer on a credit basis Date Account Debit Credit Accounts receivable $18,000 Revenue $18,000...
View Full Document

This note was uploaded on 03/31/2011 for the course ACCT 3391 taught by Professor Turpin during the Spring '10 term at Troy.

Page1 / 3

ACT3391BrushingUpOnAcctgCycle - Date Account Debit Credit...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online