Question

Below are the transactions for Ute Sewing Shop for March, the first month of operations.

Answer 1

Answer:

Part 1

March 1

Debit : Cash  $1,400

Credit : Common Stock  $1,400

March 3

Debit : Equipment  $1,100

Credit : Note Payable $1,100

March 5

Debit : Rent Expense $440

Credit : Cash $440

March 7

No Entry

March 12

Debit : Supplies $114

Credit : Accounts Payable  $114

March 15

Debit : Cash $640

Credit : Service Revenue $640

March 19

Debit : Cash $540

Credit : Deferred Revenue $540

March 25

Debit : Deferred Revenue $540

Credit : Service Revenue $540

March 30

Debit : Utilities Expense $79

Credit : Cash $79

March 31

Debit : Dividends $70

Credit : Cash $70

Part 2 and Part 3

Cash : Debit = $1,400 + $640 + $540 Credit = $440 + $79 + $70, Balance = 1,991 Debit

Common Stock : Debit =   Credit = $1,400 , Balance = 1,400 Credit

Equipment : Debit = $1,100  Credit = , Balance = 1,110 Debit

Note Payable : Debit =   Credit = $1,100 , Balance = 1,100 Credit

Rent Expense : Debit = $440  Credit = , Balance = $440 Debit

Supplies : Debit = $114   Credit = , Balance = $144 Debit

Accounts Payable : Debit =   Credit = $114 , Balance = $114 Credit

Service Revenue : Debit =   Credit = $640 + $540 , Balance = $1,180 Credit

Deferred Revenue : Debit =  $540  Credit = $540 , Balance = $ 0

Utilities Expense : Debit = $79  Credit = , Balance = $79 Debit

Dividends : Debit = $70  Credit = , Balance = $70 Debit

Part 4

Sewing Shop

Trial balance as at March 31

                                                           Debit                 Credit

Cash                                                 $ 1,991

Common Stock                                                           $1,400

Equipment                                         $1,110

Note Payable                                                               $1,100

Rent Expense                                    $440

Supplies                                              $144

Accounts Payable                                                          $114

Service Revenue                                                         $1,180

Deferred Revenue                               $ 0                       $0

Utilities Expense                                 $79

Dividends                                                                        $70

Totals                                               $3,864               $3,864

Explanation:

To successfully tackle the question, follow the steps :

1. Record journal entries
2. Post the Journals to Ledger Accounts
3. Find the Ledger Account Balances
4. Prepare a Trial Balance

The Trial Balance is used to check mathematical accuracy. It is a list of Debit and Credit extracted from Balances from the Ledger Accounts.