Question

Oct Stockholders invested $35,000 in exchan ge for common stock of the corporation. Hires an administrative assistant at an annual salary of $36,000 3 Buys equipment for $3,500 on account. 6 Sells a house and lot for M Springer; commissions due from Springer, $10,000 (not paid by Springer at this 2 . time). 10 Receives cash of $140 as commission for acting as rental agent renting an apartment. 27 Pays $700 on account for the equipment purchased on October 3. 30 Pays the administrative assistant $3,000 in salary for October. Instructions (a) Journalize the transactions.

Answer 1

Journalizing the provided transactions involves recording them in the company's books using double-entry accounting. This includes investments in common stock, purchasing equipment, sales commissions, rental commissions, paying off accounts payable, and salary payments. Each transaction is documented with appropriate debit and credit entries.

Step-by-step explanation:

The student's question requires the journalizing of various business transactions. These transactions involve the investment in common stock, salary payment for an administrative assistant, equipment purchases, sales commissions, receiving commissions, and payment of accounts. Each transaction affects the company's financial statements differently and needs to be recorded using the double-entry bookkeeping system.

Journal Entries:

• Oct 2: Debit Cash $35,000, Credit Common Stock $35,000 (Investors invest in the company).
• Oct 3: Debit Equipment $3,500, Credit Accounts Payable $3,500 (Equipment purchase on account).
• Oct 6: Debit Accounts Receivable $10,000, Credit Commissions Revenue $10,000 (Commission due from house and lot sale).
• Oct 10: Debit Cash $140, Credit Commissions Revenue $140 (Received commission for rental).
• Oct 27: Debit Accounts Payable $700, Credit Cash $700 (Partial payment for equipment).
• Oct 30: Debit Salary Expense $3,000, Credit Cash $3,000 (Payment of administrative assistant's salary).

These journal entries track the economic activity of the company and provide a clear record of its financial transactions for the month of October.