Question

During its first month of operation, the Plumbing Repair Company, which, specializes in plumbing repair services, completed the following transactions.

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Date Transaction Description
September 1 Started a plumbing repair business by making a $100,000 deposit in a company bank account, in exchange for 20,000 shares of $5 par value common stock.
September 1 Purchased insurance for the year and paid $3,000 cash.
September 2 Paid monthly rent with $3,500 cash on a warehouse to store the plumbing equipment.
September 5 Purchased plumbing equipment for $25,000, making a $5,000 down payment and placing $20,000 on account.
September 6 Purchased supplies for $2,000 on account.
September 7 Paid $750 cash for advertising in local newspapers.
September 10 Received $15,000 in cash for plumbing services provided.
September 12 Paid $5,000 for plumbing equipment previously purchased on account on September 5th.
September 15 Provided plumbing services on account for $2,500.
September 23 Received $22,000 in cash for plumbing services provided.
September 25 Received $1,500 cash for plumbing services performed on account on September 15th.
September 28 Paid $500 cash for a utility bill.
September 30 Paid cash dividends of $1,000.
September 30 One month's insurance expired.
September 30 The inventory of supplies showed a balance of $1,200 on hand at the end of the month.

enter this on journal entry

Answer 1

Here are the journal entries for the transactions of the Plumbing Repair Company during its first month of operation:

September 1:

Cash 100,000

Common Stock (20,000 shares) 100,000

(To record the issuance of 20,000 shares of $5 par value common stock for $100,000 cash deposit.)

Prepaid Insurance 3,000

Cash 3,000

(To record the payment for insurance for the year.)

September 2:

Prepaid Rent 3,500

Cash 3,500

(To record the payment of one month's rent for the warehouse.)

September 5:

Plumbing Equipment 25,000

Cash 5,000

Accounts Payable 20,000

(To record the purchase of plumbing equipment with a $5,000 down payment and $20,000 on account.)

September 6:

Supplies 2,000

Accounts Payable 2,000

(To record the purchase of supplies on account.)

September 7:

Advertising Expense 750

Cash 750

(To record the payment for advertising in local newspapers.)

September 10:

Cash 15,000

Service Revenue 15,000

(To record the receipt of $15,000 in cash for plumbing services provided.)

September 12:

Accounts Payable 5,000

Cash 5,000

(To record the payment for the plumbing equipment purchased on account.)

September 15:

Accounts Receivable 2,500

Service Revenue 2,500

(To record the provision of plumbing services on account for $2,500.)

September 23:

Cash 22,000

Accounts Receivable 22,000

(To record the receipt of $22,000 in cash for plumbing services provided on account.)

September 25:

Cash 1,500

Accounts Receivable 1,500

(To record the receipt of $1,500 cash for plumbing services performed on account on September 15th.)

September 28:

Utilities Expense 500

Cash 500

(To record the payment for a utility bill.)

September 30:

Dividends 1,000

Cash 1,000

(To record the payment of cash dividends.)

Insurance Expense 250

Prepaid Insurance 250

(To record the expired insurance for one month.)

September 30:

Supplies Expense 1,200

Supplies 1,200

(To record the adjustment for the supplies on hand at the end of the month.)

Please note that these journal entries are based on the provided information and may be subject to accounting policies and conventions followed by the Plumbing Repair Company.