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OTA: 106425, CHIDI NGENE

2. Journal Entries
During July 2009, Krogue, Inc. completed the following transactions. Prepare the journal entry for
each transaction.
July 2 Received $320,000 for 80,000 shares of capital stock
4 Purchased $90,000 of equipment, with 75% down and 25% on a note payable
13 Purchased $250,000 of inventory, paying 40% down and 60% on credit
20 Collected $7,500 from accounts receivable
27 Paid property taxes of $1,200
30 Paid $150,000 of accounts payable for inventory purchased on July 13
TUTORIAL
DATE
Jul-02

Jul-04

Jul-13

Jul-20

Jul-27

Jul-30

DESCRIPTION
CASH
CAPITAL STOCK
(BEING THE PAYMENT FOR 80,000
SHARES PAID BY CASH)
EQUIPMENT
NOTES PAYABLE
CASH
(BEING THE PAYMENT FOR EQUIPMENT
PURCASHES THROUGH 75% CASH PAYMENT
AND 25% NOTES PAYABLE)
INVENTORY
CASH
ACCOUNTS PAYABLE
(BEING THE PURCHASE OF INVENTORY
ON CREDIT TERMS AND THROUGH
CASH)
CASH
ACCOUNTS RECEIVABLE
(BEING THE AMOUNT OF CASH
COLLECTED FROM ACCOUNTS
RECEIVABLES)
PROPERTY TAXES
CASH
(BEING THE PAYMENT OF PROPERTY
TAXES)
ACCOUNTS PAYABLE
CASH
(BEING THE PAYMENT OF CASH
TO ACCOUNTS PAYABLE FOR
INVENTORY PURCHASES)

DR.

320,000

CR.
320,000

90,000
22,500
67500

250,000
100,000
150,000

7,500
7,500

1,200
1,200

150,000
150,000

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