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Horngren'S Financial And Managerial Accounting
Found in: Page 78

Short Answer

EMB Consulting Services had the following transactions for the month of November. Journalize the transactions and include an explanation with each entry.

Nov. 1 The business received $10,000 cash and issued common stock.

15 Purchased office supplies on account, $400.

18 Paid advertising bill, $150.

20 Received $1,000 from customers for services rendered.

28 Cash dividends of $500 were paid to stockholders

Answer

Dividends are profits distributed to the shareholders and required entries are passed.

See the step by step solution

Step by Step Solution

Step 1: Definition of Dividends

The dividends are defined as the part of the profits of the business which are distributed among the shareholders or the owners of the company.

Step 2: Journal Entries

Date

Particulars

Amount ($)

Amount ($)

Nov 1

Cash

10,000

Common Stock

10,000

(Common stock issued)

Nov 15

Supplies

400

Accounts Payable

400

(Supplies purchased on credit)

Nov 18

Advertising Expense

150

Cash

150

(Advertising expenses paid)

Nov 20

Cash

1,000

Service Revenue

1,000

(Cash received for service revenue)

Nov 28

Dividends

500

Cash

500

(Dividends paid in cash)

Most popular questions for Business-studies Textbooks

Journalizing transactions, posting journal entries to four-column accounts, and preparing a trial balance

The trial balance of Shawn Merry, CPA, is dated March 31, 2018: During April, the business completed the following transactions:

Cash 11,000

Office Supplies 400

Accounts Receivable 16,500

Land 30,000

Furniture 0

Automobile 0

Accounts Payable 3,800

Unearned Revenue 0

Common Stock 52,300

Dividends 0

Rent Expense 800

Salaries Expense 5,600

Service Revenue 8,200

Total Balance $ 64,300 64,300

During April, the business completed the following transactions:

Apr. 4 Collected $2,500 cash from a client on account.

8 Performed tax services for a client on account, $5,400.

13 Paid $3,000 on account.

14 Purchased furniture on account, $3,600.

15 Merry contributed his personal automobile to the business in exchange for common stock. The automobile had a market value of $9,500.

18 Purchased office supplies on account, $900.

19 Received $2,700 for tax services performed on April 8.

20 Paid cash dividends of $6,500.

21 Received $5,700 cash for consulting work completed.

24 Received $2,400 cash for accounting services to be completed next month.

27 Paid office rent, $600.

28 Paid employee salary, $1,700.

Requirements

  1. Record the April transactions in the journal. Use the following accounts: Cash; Accounts Receivable; Office Supplies; Land; Furniture; Automobile; Accounts Payable; Unearned Revenue; Common Stock; Dividends; Service Revenue; Salaries Expense; and Rent Expense. Include an explanation for each entry
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