Invested $105,000 cash, office equipment with a value of $6,000, and $45,000 of drafting equipment to launch the business. How would this journal entry be posted to the general journal?
debit 105,000
debit 6,000
Dr. Cash 105.000
Dr. Equipment 51.000
Cr. Capital 156.000
To post the journal entry for the investment of cash, office equipment, and drafting equipment into the business, you would need to follow these steps:
1. Identify the accounts involved: In this case, we have Cash, Office Equipment, and Drafting Equipment.
2. Determine the appropriate journal entry format: Since cash is involved, this would be a standard journal entry, typically denoted as a "JV" in the general journal.
3. Assign appropriate account codes: Each account has a unique code that helps organize the entries in the general journal. For example, Cash might be assigned a code of 101, Office Equipment might be 105, and Drafting Equipment might be 106.
4. Write the journal entry: The journal entry typically has two columns: the debit column (left side) and the credit column (right side). The total debits must equal the total credits for the entry to balance.
Based on the given information, the journal entry would look like this:
General Journal
Date | Account | Debit | Credit
-------------------------------------------------
| Cash | $105,000 |
| Office Equipment | $6,000 |
| Drafting Equipment | $45,000 |
Explanation:
- The Cash account is debited with $105,000 because cash is an asset and increases on the debit side.
- The Office Equipment account is debited with $6,000 to include its value in the business assets.
- The Drafting Equipment account is debited with $45,000 to include its value in the business assets.
Remember, in this entry, we are not offsetting the debits with credits because these investments are considered as contributions from the owner(s) and do not involve any external liabilities.
Once you've completed this journal entry, make sure to continue posting other journal entries as needed to keep track of your business's financial transactions.