Please prepare the following journal entries. Indicate which account should be debited and which account should be credited along with the dollar amount of the debit and credit.
a) Investors invested $100,000 in exchange for 10,000 shares of common stock.
b) Company paid a utility bill for $600
c) Company received cash of $15,000 for services performed
d) Company made payment on account for $1,000
e) Company received $12,000 for services not yet performed
a) To record the investment by the investors:
- Debit: Cash (for $100,000)
- Credit: Common Stock (for $100,000)
b) To record the payment of the utility bill:
- Debit: Utilities Expense (for $600)
- Credit: Cash (for $600)
c) To record the receipt of cash for services performed:
- Debit: Cash (for $15,000)
- Credit: Service Revenue (for $15,000)
d) To record the payment on account:
- Debit: Accounts Payable (for $1,000)
- Credit: Cash (for $1,000)
e) To record the receipt of cash for services not yet performed:
- Debit: Cash (for $12,000)
- Credit: Unearned Service Revenue (for $12,000)
These journal entries are based on the assumption that there are no applicable taxes or discounts to be considered. Additionally, be sure to consult with an accountant to ensure proper account categorization and compliance with accounting standards are met.
a)
Debit: Cash ($100,000)
Credit: Common Stock ($100,000)
b)
Debit: Utilities Expense ($600)
Credit: Cash ($600)
c)
Debit: Cash ($15,000)
Credit: Service Revenue ($15,000)
d)
Debit: Accounts Payable ($1,000)
Credit: Cash ($1,000)
e)
Debit: Cash ($12,000)
Credit: Unearned Revenue ($12,000)