PROBLEM 3-9

Jan 2

Cash

Post Ref.

Debit

200000

Capital Stock

Credit

200000
Jan 2

Office Building
Land

4
Cash

Jan 2

Cash

110000
40000

150000

1
Notes Payable

125000
5

125000
Jan 2

Jan 2

Office Equipment

Cash

10000

Accounts Payable

40000

Wages and Salary Expenses

Jan 12

Jan 30

Cash

Accounts Payable

Cash

Cash

50000

13000
40000
40000

1
Accounts Receivable

13000

24000
9

24000
Jan 30

Wages and Salary Expenses

Cash

Jan 30

Commission
Accounts Payable

15000

1
10
7

15000
3500
3500

PROBLEM 3-10
1.

GENERAL LEDGER
CASH
Date

ACCOUNT No. 1
Post Ref.

Debit

Credit

Balance

200000
200000
150000
50000
125000
175000
10000

165000

13000

152000

40000

112000

24000

136000
15000

CAPITAL STOCK
Date

Post Ref.

Debit

121000

ACCOUNT No. 2
Credit

Balance

200000
200000

OFFICE BUILDING
Date

Post Ref.

ACCOUNT No. 3
Debit

Credit

Balance

110000
110000

LAND
Date

ACCOUNT No. 4
Post Ref.

Debit

Credit

40000

NOTES PAYABLE
Date

Post Ref.

Debit

Balance
40000

ACCOUNT No. 5
Credit

Balance

125000
125000

OFFICE EQUIPMENT

ACCOUNT No. 6

Date

Post Ref.

Debit

Credit

50000

50000

ACCOUNTS PAYABLE
Date

Post Ref.

ACCOUNT No. 7

Debit

Credit

Balance

40000

40000

40000

0
3500

WAGES AND SALARY EXPENSES

Date

Post Ref.

Debit

Post Ref.

Credit

Post Ref.

Balance

13000

13000

15000

28000

ACCOUNT No. 9

Debit

Credit

Balance

24000

24000

COMMISSION
Date

3500

ACCOUNT No. 8

ACCOUNTS RECEIVABLE
Date

Balance

ACCOUNT No. 10
Debit

Credit

3500

Balance
3500

2.

TRIAL BALANCE
Account Titles
Credits
Cash

Debits
121000

Capital Stock
200000
Building

110000

Land

40000

Notes Payable
125000
Office Equipment

50000

Accounts Payable
Wages and Salary Expenses

3500
28000

Accounts Receivable
24000
Commission

3500

Totals
352500

352500

EXERCISE 4-3
1. New office copier
Direct (a)
2. Monthly bill from utility company for electricity
(c)
3. Office Supplies
(a) or (c)
Some office supplies can be useful in that period itself and some can have
a future use as well
4. Biweekly Payroll for office employees
(a)
5. Commissions earned by salespeople
(a)
6. Interest incurred on a six month loan from the bank
(c)
7. Cost of inventory sold during the current period
(a)
8. Taxes owed on income earned during rent period
(c)
9. Cost of 3 year insurance policy
(c)

EXERCISE 4-15
March 1

Cash

100000
Notes Payable

100000
Total interest = 100000 x 0.12 x (3/12) = 3000
Per month interest = 1000
The adjusting entry is as follows
End of Month of March
ASSETS
=
LIABILITIES
STOCKHOLDERS
Interest
Payable

REVENUES

EXPENSES
Interest
Expense

EQUITY
(1000)

NET
INCOME

1000

1000

ASSETS
=
LIABILITIES
STOCKHOLDERS
Interest
Payable

+
EQUITY
(1000)

1000

REVENUES

EXPENSES

Interest
(1000)
Expense

1000

NET
INCOME

End of April
End of May

ASSETS
=
LIABILITIES
STOCKHOLDERS

+
EQUITY
(1000)

Cash (103000)
Interest
Payable
(2000)
Notes
Payable
(100000)

REVENUES

EXPENSES

Interest
(1000)
Expense

1000

NET
INCOME