Answer to Question #174143 in Accounting for Denisse Bisuña

Question

identify and name the parts of the general journal below. journalize the following selected march 2021 transactions using the general journal below.

March 1 The owner, J Simon, invests P100,000 cash in his barber shop

Analysis: Increase in Asset (Dr) Cash P100,000

Increase in Equity (Cr) J Simon, Capital P100,000

March 3 The business buys a lot for P2M paying cash of P800,000 and the balance covered by promissory note.

Analysis: Increase in Asset (Dr) Land P2,000,000

Decrease in Asset (Cr) Cash P800,000

March 6 The owner, J Simon pays P7,500 accounts payable of the business from his personal savings.

Analysis: Decrease in liability (Dr) Accounts Payable P7,500

Increase in Equity (Cr) J Simon, Capital P7,500

Answer 1

Cash invested by the owner.

It increases cash since it is an asset and debited.

It increases the Equity of the person since it is a liability and credited.

March 3:

The business purchases a plot by cash and promissory note.

It increases Land since it is an asset and debited.

It decreases Cash since it is an asset and credit.

The difference is (2,000,000 – 800,000 =) 1,200,000 would be in the Promissory note account, which is a liability and credited.

March 6:

Payment of business account by the owner directly.

It decreases the liability, Accounts Payable; therefore, debited.

It increases the Equity of J.S. therefore, it is credited.