SOLUTIONS TO PROBLEMS
PROBLEM 2-1A
J1
Date
Account Titles and Explanation
Ref.
Debit
Credit
Mar. 1
Cash ……………………………………………….
20,000
Owner’s Capital ………………………..
20,000
(Owner’s investment of cash
in business)
3
Land ………………………………………………..
12,000
Buildings …………………………………………
2,000
Equipment ……………………………………….
1,000
Cash ………………………………………..
15,000
(Purchased Rainbow’s Golf Land)
5
Advertising Expense ………………………..
900
Cash ………………………………………..
900
(Paid for advertising)
6
Prepaid Insurance …………………………...
600
Cash ………………………………………..
600
(Paid for one-year insurance
policy)
10
Equipment ……………………………………….
1,050
Accounts Payable …………………….
1,050
(Purchased equipment on
account)
18
Cash ……………………………………………….
1,100
Service Revenue ………………………
1,100
(Received cash for services
performed)
19
Cash ……………………………………………….
1,500
Unearned Service Revenue ……….
1,500
(Received cash for coupon
books sold)
PROBLEM 2-1A (Continued)
Date
Account Titles and Explanation
Ref.
Debit
Credit
Mar. 25
Owner’s Drawings ……………………….
Cash ……………………………………
(Withdrew cash for personal
use)
800
800
30
Salaries and Wages Expense ……….
Cash ……………………………………
250
250
30
Accounts Payable ……………………….
Service Revenue …………………..
(Received cash for services
