Exercise 2 5presented below is information related to

EXERCISE 2-5
Presented below is information related to Robbins Real Estate Agency.
Oct.
1
Lynn Robbins begins business as a real estate agent with a cash investment of $20,000 in
exchange for common stock.
2 Hires an administrative assistant.
3 Purchases office furniture for $1,900, on account.
6 Sells a house and lot for N. Fennig; bills N. Fennig $3,200 for realty services provided.
27 Pays $850 on the balance related to the transaction of October 3.
30 Pays the administrative assistant $2,500 in salary for October.
General Journal
Date Account Titles and Explanation Ref. Debits Credit
Oct. 1 Cash .................................................... 20,000
Common Stock ......................... 20,000
2 No entry.
3 Equipment ......................................... 1,900
Accounts Payable ..................... 1,900
6 Accounts Receivable ........................ 3,200
Service Revenue ....................... 3,200
27 Accounts Payable .............................. 850
Cash ........................................... 850
30 Salaries and Wages Expense ........... 2,500
Cash ........................................... 2,500
2-7

EXERCISE 2-6
Elvira Industries had the following transactions.
1. Borrowed $5,000 from the bank by signing a note.
2. Paid $2,500 cash for a computer.
3. Purchased $450 of supplies on account.
(a) Indicate what accounts are increased and decreased by each transaction.
2-8

EXERCISE 2-10
(a)
General Journal
Date Account Titles and Explanation Ref. Debit Credit
Apr. 1 Cash ......................................................
Common Stock ................................
(Issued shares of stock
for cash)
10,000
10,000
12 Cash ......................................................
Service Revenue ..............................
(Received cash for
services provided)
900
900
15 Salaries and Wages Expense .............
Cash ..................................................
(Paid salaries to date)
600
720
25 Accounts Payable ................................
Cash ..................................................
(Paid creditors on account)
1,500
1,500
29 Cash ......................................................
Accounts Receivable ......................
(Received cash in payment
of account)
400
400
30 Cash ......................................................
Unearned Service Revenue ............
(Received cash for future
services)
1,000
1,000
2-9

EXERCISE 2-10 (Continued)
(b) PADRE LANDSCAPING COMPANY
Trial Balance
April 30, 2014
Debit
Credit
Cash ........................................................................... $10,080
Accounts Receivable ................................................ 2,800
Supplies ..................................................................... 1,800
Accounts Payable .....................................................
300
Unearned Service Revenue ...................................... 1,000
Common Stock ..........................................................
10,000
Service Revenue ....................................................... 4,100
Salaries and Wages Expense ................................... 720
$15,400
$15,400
EXERCISE 2-11
(a) Oct. 1 Cash .............................................................. 5,000
Common Stock ...................................... 5,000
(Issued shares of stock for cash)
10 Cash .............................................................. 650
Service Revenue ...................................
(Received cash for services
provided)
10 Cash .............................................................. 3,000
Notes Payable ........................................ 3,000
(Obtained loan from bank)
2-10

20 Cash .............................................................. 500
Accounts Receivable ............................