June:
1)Sold a house and collected a $6,000 commission.
Ans: Cash (debit)
Commission earned (credit)
2)Sold a building lot and earned a commission, $6,500. Payment is to be
received on July 8.
Ans: Accounts recievable (DR)
comission Earned (CR)
3)Received advertising bill for June, $1,200. The bill is to be paid on
July 2
Ans: Advertising Expense (DR)
Accounts Payable(CR)
To answer these questions, the following accounting entries need to be made:
1) Sold a house and collected a $6,000 commission.
The entry for this transaction would be:
- Debit: Cash (to record the amount collected)
- Credit: Commission earned (to record the revenue generated from the commission)
2) Sold a building lot and earned a commission, $6,500. Payment is to be received on July 8.
Since payment is not received immediately but will be received on a future date, the following entry needs to be made:
- Debit: Accounts Receivable (to record the amount to be received)
- Credit: Commission earned (to record the revenue generated from the commission)
3) Received an advertising bill for June, $1,200. The bill is to be paid on July 2.
As the bill is for an expense and not revenue, the following entry needs to be made:
- Debit: Advertising Expense (to record the expense incurred)
- Credit: Accounts Payable (to record the amount owed for the bill)
These entries help track and record the financial transactions accurately in the accounting books.