This information relates to Sheffield Real Estate Agency.

Oct. 1 Stockholders invest $33,860 in exchange for common stock of the corporation.
2 Hires an administrative assistant at an annual salary of $31,320.
3 Buys office furniture for $3,850, on account.
6 Sells a house and lot for E. C. Roads; commissions due from Roads, $10,620 (not paid by Roads at this time).
10 Receives cash of $220 as commission for acting as rental agent renting an apartment.
27 Pays $790 on account for the office furniture purchased on October 3.
30 Pays the administrative assistant $2,610 in salary for October.

Required:
Prepare the debit-credit analysis for each transaction.

Question

contestada

Respuesta :

TomShelby TomShelby · Answer 1 · 2020-10-09T17:24:03+02:00

Answer:

cash 33,860 debit (+assests)

common stock 33,860 credit (+equity)

---

no entry required

--

furniture 3,850 debit (+assets)

account payable 3,850 credit (+liabilities)

---

accounts receivables 10,620 debit (+assets)

commissions revenues 10,620 credit (+revenue / +equity)

---

cash 220 debit (+assets)

commissions revenues 220 credit (+revenue / +equity)

---

Accounts Payable 790 debit (- liaiblities)

cash 790 credit (- assets)

---

Salaries expense 2,610 debit (+ expense / - equity)

cash 2,610 credit (-assets)

Explanation:

We do the journal entries following the accounting rules

debit = credit

and we usethe accoutnign equation analysis

Assets + Expenses = Liablities + Equity + Revenues

DEBIT CREDIT DEBIT CREDIT

+ + + - - - - - - + + +

The left side increase from debit and decrease from credit

while the element of the right side increase through credit and decrease by debit