Question

Shamrock Crusher is a licensed CPA. During the first month of operations of her business (a sole proprietorship), the following events and transactions occurred.

April 2 Invested $27,070 cash and equipment valued at $12,900 in the business.

2 Hired an administrative assistant at a salary of $255 per week payable monthly.

3 Purchased supplies on account $833. (Debit an asset account.)

7 Paid office rent of $546 for the month.

11 Completed a tax assignment and billed client $1,160 for services rendered. (Use Service Revenue account.)

12 Received $2,589 advance on a management consulting engagement.

17 Received cash of $2,201 for services completed for Ferengi Co.

21 Paid insurance expense $100. 30 Paid administrative assistant $1,020 for the month.

30 A count of supplies indicated that $122 of supplies had been used.

30 Purchased a new computer for $5,266 with personal funds. (The computer will be used exclusively for business purposes.)

Journalize the transactions in the general journal.

Answer 1

• Working forms part of the journal entries. Entries are self explanatory.
• Journal Entries

Date (April)	Accounts Titles	Debit	Credit
2	Cash	27070
	Equipment	12900
	Owners' Equity (Capital)		39970
2	No entry for hiring the assistant
3	Supplies	833
	Accounts payables		833
7	Rent expense	546
	Cash		546
11	Accounts receivables	1160
	Service Revenue		1160
12	Cash	2589
	Advance ffrom customer		2589
17	Cash	2201
	Service Revenue		2201
21	Insurance expense	100
	Cash		100
30	Salaries expenses	1020
	Cash		1020
30	Supplies expense	122
	Supplies		122
30	Computer	5266
	Owner's Equity (Capital)		5266