Answer to Question #216338 in Accounting for zuby

Question

Economy Laundry Company had the following transactions in August 2010:

Aug. 1 Issued capital stock for cash, USD 150,000.

3 Borrowed USD 40,000 from the bank on a note.

4 Purchased cleaning equipment for USD 25,000 cash.

6 Performed services for customers who promised to pay later, USD 16,000.

7 Paid this month's rent on a building, USD 2,800.

10 Collections were made for the services performed on August 6, USD 3,200.

14 Supplies were purchased on account for use this month, USD 3,000.

17 A bill for USD 400 was received for utilities for this month.

25 Laundry services were performed for customers who paid immediately, USD 22,000.

31 Paid employee salaries, USD 6,000.

31 Paid cash dividend, USD 2,000.

a. Prepare journal entries for these transactions.

b. Post the journal entries to T-accounts.

Answer 1

a)

b)