Explore BrainMass

Explore BrainMass

    Accounting: Type of Account

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    1.
    Jan. 2 Invested $10,000 cash in business in exchange for common stock.
    3 Purchased used car for $4,000 cash for use in business.
    9 Purchased supplies on account for $500.
    11 Billed customers $1,800 for services performed.
    16 Paid $200 cash for advertising.
    20 Received $700 cash from customers billed on January 11.
    23 Paid creditor $300 cash on balance owed.
    28 Declared and paid a $1,000 cash dividend.
    Instructions
    For each transaction indicate the following.
    (a) The basic type of account debited and credited (asset, liability, owner's equity).
    (b) The specific account debited and credited (cash, rent expense, service revenue, etc.)
    (c) Whether the specific account is increased or decreased.
    (d) The normal balance of the specific account.

    DEBIT
    A BASIC TYPE ASSET
    B SPECIFIC ACCOUNT CASH
    C EFFECT INCREASE
    D NORMAL BALANCE DEBIT

    CREDIT
    A BASIC TYPE STOCKHOLDER'S EQUITY
    B SPECIFIC ACCOUNT COMMON STOCK
    C EFFECT INCREASE
    D NORMAL BALANCE CREDIT

    2. ALSO JOURNALIZE THE TRANSACTIONS.

    © BrainMass Inc. brainmass.com June 4, 2020, 1:59 am ad1c9bdddf
    https://brainmass.com/business/accounting/accounting-type-account-431046

    Solution Summary

    The solution discusses the type of account for each transaction.

    $2.19

    ADVERTISEMENT