This preview shows page 1. Sign up to view the full content.
Unformatted text preview: z ed a c orporation to prov ide aerial photography s erv ic es . The
c ompany , c alled Aerial Views , began operations immediately . Trans ac tions during the month of J une were
as follows : June 1 The c orporation is s ued 60,000 s hares of c apital s toc k to Wendy Winger in ex c hange for $60,000
c as h. June 2 Purc has ed a plane from Utility Airc raft for $220,000. Made a $40,000 c as h down pay ment and
is s ued a note pay able for the remaining balanc e. June 4 Paid Woodrow Airport $2,500 to rent offic e and hangar s pac e for the month. June 15 Billed c us tomers $8,320 for aerial photographs tak en during the firs t half of J une. June 15 Paid $5,880 in s alaries earned by employ ees during the firs t half of J une. June 18 Paid Hannigan's Hangar $1,890 for maintenanc e and repair s erv ic es on the c ompany plane. June 25 Collec ted $4,910 of the amounts billed to c us tomers on J une 15. June 30 Billed c us tomers $16,450 for aerial photographs tak en during the s ec ond half of the month. June 30 Paid $6,000 in s alaries earned by employ ees during the s ec ond half of the month. June 30 Rec eiv ed a $2,510 bill from Peatree Petroleum for airc raft fuel purc has ed in J une. The entire
amount is due J uly 10. June 30 Dec lared a $2,000 div idend pay able on J uly 15.
The ac c ount titles us ed by Aerial Views are: Cas h Ac c ounts Rec eiv able Airc raft Notes Pay able Ac c ounts Pay able Div idends Pay able Capital Stoc k Retained Earnings
Aerial Photography Rev enue
Maintenanc e Ex pens e
Fuel Ex pens e
Salaries Ex pens e
Rent Ex pens e a. Analy z e the effec ts that eac h of thes e trans ac tions will hav e on the following s ix c omponents of the
c ompany 's financ ial s tatements for the month of J une. Organiz e y our ans wer in tabular form, us ing the
c olumn headings s hown. Us e I for inc reas e, D for dec reas e, and NE for no effec t. The J une 1
trans ac tion is prov ided for y ou: Inc ome Statement Trans ac tion J une 1 J une 2 J une 4 J une 15 J une 15 J une 18 J une 25 J une 30 J une 30 J une 30 J une 30 Rev enue NE NE NE I NE NE NE I NE NE NE – NE NE I NE I I NE NE I I NE Ex pens es =
Net Inc ome NE NE D I D D NE I D D NE I I D I D D NE I D NE NE Balanc e Sheet
As s ets = NE I NE NE NE NE NE NE NE I I Liabilities +
Owners ' Equity I NE D I D D NE I D D D b. Prepare journal entries for abov e eac h trans ac tion. (Om it the "$" sign in your response.)
J une 1 Cas h Capital s toc k General J ournal e z to.mhe c loud.mc gr a w- hill.c om/hm_a c c ounting.tpx? todo= pr intvie w Debit
60,000 Credit 60,000 3/7 11/18/13 Assignme nt Pr int Vie w
2 Airc raft 220,000 2,500 Cas h Notes pay able 4 Rent ex pens e Cas h 15 Ac c ounts rec eiv able Aerial photography rev enue Salaries ex pens e Cas h 18 Maintenanc e ex pens e Cas h 25 Cas h Ac c ounts rec eiv able 30 Ac c ounts rec eiv able Aerial photography rev enue Salaries ex pens e Cas h Fuel ex pens e Ac c ounts pay able Div idends Div idends pay able 40,000 180,000 2,500 8,320 5,880 1,890 4,910 16,450 6,000 2,510 2,000 8,320 5,880 1,890 4,910 16,450 6,000 2,510 2,000 c. Pos t eac h trans ac tion to the appropriate ledger a...
View Full Document
This document was uploaded on 03/03/2014 for the course MGMT ACCOU 2300 at Rensselaer Polytechnic Institute.
- Fall '08