25.6k views
1 vote
For each transaction, (1) analyze the transaction using tha accounting equation, (2)record the transaction in journal entry form and (3)post the entry using T accounts to represent ledger accounts. Use the partial chart of accounts - account numbers in parentheses: cash(101); Acct receivable (106); Office supplies (124); Trucs (153); Equipment (167) Acct payable (201);unearned landscaping revenue (236); common stock (307); Dividends (319); Wages expenses (601) and landscaping expense(696).

a. On May 15 Taylor opens a landscaping company called Elegant Lawns by investing $84,000 in cash along with Equipment having a $44,000 value in exchange for common stock.
b. On May 21, Elegant Lawns purchases Office supplies on credit for $560.
c. On May 25. Elegant Lawns recives $9,200 cash for performing landscaping services.
d. On May 30, Elegant Lawns receives $2,400 cash in advance of providing landscaping services to a customer.

User Oberger
by
7.3k points

1 Answer

6 votes

Final answer:

To analyze and record the transactions of a landscaping company, we use the accounting equation to understand the changes in assets, liabilities, and equity; then prepare journal entries and post them to T accounts, which categorize and balance assets on one side and liabilities and equity on the other side.

Step-by-step explanation:

Accounting Transaction Analysis and Journal EntriesFor the transactions of a landscaping company, we first analyze each event using the accounting equation, then record them in journal entry form, and finally post them using T accounts to represent ledger accounts.a. May 15: Investment in Exchange for Common StockAccounting Equation: Increase in Cash (Assets) + Increase in Equipment (Assets) = Increase in Common Stock (Equity)Journal Entry: Debit Cash for $84,000, Debit Equipment for $44,000, Credit Common Stock for $128,00T Accounts: Cash and Equipment are debited (left side), Common Stock is credited (right side).b. May 21: Office Supplies Purchase on CreditAccounting Equation: Increase in Office Supplies (Assets) = Increase in Accounts Payable (LiabilitiesJournal Entry: Debit Office Supplies for $560, Credit Accounts Payable for $560.

T Accounts: Office Supplies are debited, Accounts Payable are credited.c. May 25: Cash Received for Landscaping ServicesAccounting Equation: Increase in Cash (Assets) = Increase in Landscaping Revenue (EquityJournal Entry: Debit Cash for $9,200, Credit Landscaping Revenue for $9,200T Accounts: Cash is debited, Landscaping Revenue is creditedd. May 30: Cash Received in Advance of ServicesAccounting Equation: Increase in Cash (Assets) = Increase in Unearned Landscaping Revenue (LiabilitiesJournal Entry: Debit Cash for $2,400, Credit Unearned Landscaping Revenue for $2,400T Accounts: Cash is debited, Unearned Landscaping Revenue is credited.

User Prranay
by
8.8k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.