The business was started on April 1st.
I have the following events that happened: what accounts should I debit and credit?
1. Incurred advertising expense of $1,907 on account.
2. Hired park manager at a salary of $3,783 per month, effective May 1.
3. Sold 140 coupon books for $50 each. Each book contains 10 coupons that entitle the holder to one admission to the park.
4. Paid $755 on balance owed for advertising incurred on April 8.
Hopefully that is enough information.
Well, let's clown around and figure this out!
1. Incurred advertising expense of $1,907 on account.
Debit: Advertising Expense - $1,907
Credit: Accounts Payable - $1,907
2. Hired park manager at a salary of $3,783 per month, effective May 1.
Debit: Salaries Expense - $3,783
Credit: Salaries Payable - $3,783
3. Sold 140 coupon books for $50 each. Each book contains 10 coupons that entitle the holder to one admission to the park.
Debit: Accounts Receivable - $7,000 (140 coupon books * $50)
Credit: Coupon Book Revenue - $7,000
4. Paid $755 on balance owed for advertising incurred on April 8.
Debit: Accounts Payable - $755
Credit: Cash - $755
Remember, these are just clown suggestions! It's always best to double-check with an actual financial advisor or accountant before making any serious decisions.
To determine the accounts to debit and credit for each event, we need to understand the basic principles of accounting. Each transaction affects at least two accounts: one account is debited (increased) and another is credited (decreased). Here's how you can approach each event:
1. Incurred advertising expense of $1,907 on account:
Debit: Advertising Expense (increase the expense account)
Credit: Accounts Payable (increase the liability account)
2. Hired park manager at a salary of $3,783 per month, effective May 1:
Debit: Salary Expense (increase the expense account)
Credit: Cash (decrease the asset account)
3. Sold 140 coupon books for $50 each:
Debit: Accounts Receivable (increase the asset account)
Credit: Coupon Book Revenue (increase the revenue account)
4. Paid $755 on balance owed for advertising incurred on April 8:
Debit: Accounts Payable (decrease the liability account)
Credit: Cash (decrease the asset account)
Please note that these answers are based on a simplified assumption and it's always recommended to consult an accountant or use appropriate accounting software for accurate record-keeping.