ACC107 Financial Accounting: Week 2 Assignment - Recording Transactions Worksheet

ACC107 Financial Accounting: Week 2 Assignment
Recording Transactions Worksheet

Part1. HotDawg,Inc.
HotDawg, Inc.had the following transactions during December:
Dec. 1 Purchased $7,500 in equipment on account
Dec. 5 Issued $6,000 of common stock to investors in exchange for cash.
Dec. 10 Purchased $1,750 in supplies using cash.
Dec. 14 Billed customers for $40,000 for services provided
Dec. 16 Paid salaries of $8,000 to employees.
Dec. 18 Paid dividends of $2,000 to stockholders.
Dec. 21 Received $15,000 cash in payment for services earned and billed in previous month.
Dec. 23 Paid cash for purchase in #1.
Dec. 28 Borrowed $20,000 from the bank.

Prepare journal entries for the transactions listed above in the journal below; you can omit explanations. Enter your answers in the shaded boxes. The Dec. 1 transaction has been done for you.

Part 2.Big Bunny Inc.
Big Bunny,Inc. had the following transactions for June:
June 3 Issued common stock to investors for $40,000.
June 6 Bought $8,700 of supplies on account.
June 12 Paid rent for June in the amount of $2,200 in cash.
June 13 Billed a customer for $12,500 for services provided.
June 15 Paid vendor $4,500 for June 6 purchase.
June 17 Borrowed $35,000 from the bank.
June 27 Received payment for billing made on June 13.

Prepare journal entries, post to T-Accounts, and prepare a trial balance at June 30 for Big Bunny, Inc. Enter your answers in the shaded boxes. The entries for Common Stock have been completed for you.
a. Journal Entries
b. T-Accounts
c. Trial Balance

Part 3. Debits and Credits
The following is a list of accounts that might be found on a trial balance, along with their normal balances. After each account,the effect of a debit to the account (increase or decrease), and the effect of a credit to the account (increase or decrease). Enter your answers in the table below.
ACCOUNT NORMAL BALANCE
1 Building Debit
2 Note Payable Credit
3 Common Stock Debit
4 Cash Debit
5 Wages Payable Credit
6 Unearned Revenue Credit
7 Dividends Debit
8 Supplies Credit
9 Prepaid Accounts Debit

Part 4.The Accounting Cycle
Write a brief paragraph describing the accounting cycle and its role in accounting. Use this weeks content, readings,and your LIRN resources or the Internet, as needed, to support your answer.
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