Question

Record the following transactions using the below accounting equation. The first one has been completed for you as an example. Make sure to indicate the specific account name and use a + or – sign to indicate if the overall category is being increased or decreased. Items that effect net income should only be shown in the net income column and not in stockholders’ equity.

After recording all transactions, calculate total assets, total liabilities, stockholders’ equity, revenues and expense. Prove your accounting equation is in balance.

1. Common Stock of $5,000 was sold for cash.
2. A company paid $100 to car servicing store for an oil change and regular maintenance for a corporate owned automobile. Make the entry to record this.
3. Make the entry to record $1500 of depreciation on company owned laptops.
4. Make the entry to record the purchase of equipment for $2,000 along with $200 for installation.
5. Sold land that had originally cost $100,000 for $115,000 in cash.
6. For the payroll period ended on October 19, 2018, gross pay was $22,300, net pay was $17,000, FICA tax withholdings were $1,500, income tax withholdings were $3,000, and medical insurance contributions were $800. Prepare the entry below to show the effects of the payroll accrual on October 19, 2018.
7. The Defiance College sells season tickets for four home football games at a price of $60. For the 2018 season, 5,000 season tickets were sold.
   (a.) Record the journal entry below to show the effect of the sale of the season tickets.
   (b.) Record the journal entry to show the effect of hosting a home football game

(please help with 6&7 with what its actually asking) !!!!!

Answer 1

(A) As per the question at point no.6, it is for payroll recording & entry will be:-

Salary Expense (Dr) $ 22,300

To Income Tax withholding (Cr) $3,000

To FICA tax withholding (Cr) $ 1,500

To Medical Insurance Contribution (Cr) $ 800

To Salary Payable (Cr) $ 17,000

(B) Record the journal entry below to show the effect of the sale of the season tickets.

Cash A/c (Dr.) $ 300,000

To Unearned Ticket Revenue* ( Cr) $ 300,000

* Will be shown under Current liability because the game has not hosted yet.

Record the journal entry to show the effect of hosting a home football game

Unearned Ticket Revenue (Dr) $ 300,000

To Ticket Revenue (Cr) $ 300,000

( now liability has been transfered to income on hosting of game )