Question

On April 1, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month...

a) Rent expense
b) Commissions revenue
c) Insurance expense
d) Withdrawals

Answer 1

The question involves recording financial transactions for Adventure Travel, dealing with rent expense, commissions revenue, insurance expense, and withdrawals, which will impact the company's financial statements.

Step-by-step explanation:

The question pertains to the recording of various financial transactions for a new travel agency called Adventure Travel. These transactions include: rent expense, commissions revenue, insurance expense, and withdrawals. Each of these are common accounting terms that would be recorded in the company's financial statements.

• Rent expense: This is the cost incurred for leasing a space for the business operations.
• Commissions revenue: This is the income earned from selling travel packages or services.
• Insurance expense: This is the cost of insurance premiums paid to protect the business against potential losses.
• Withdrawals: This refers to money taken out from the business by the owner for personal use.

To record these transactions, the double-entry bookkeeping system is commonly used, where each transaction affects at least two accounts, with debits equaling credits.