Aracel Engineering completed the following transactions in the month of June. a. Jenna Aracel, the owner, invested $175,000 cash, office equipment with a value of $5,200, and $76,000 of drafting equipment to launch the company in exchange for common stock.
b. The company purchased land worth $56,000 for an office by paying $8,000 cash and signing a long-term not payable for $48,000.
c. The company purchased a portable building with $54,000 cash and moved it onto the land acquired in b.
d. The company paid $2,600 cash for the premium on an 18-month insurance policy.
e. The company completed and delivered a set of plans for a client and collected $6,200 cash.
f. The company purchased $32,000 of additional drafting equipment by paying $11,900 cash and signing a long-term not payable for $20,100.
g. The company completed $18,000 of engineering services for a client. This amount is to be received in 30 days.
h. The company purchased $2,000 of additional office equipment on credit.
i. The company completed engineering services for $25,000 on credit.
j. The company received a bill for rent of equipment that was used on a recently completed job. The $1,409 rent cost must be paid within 30 days.
k. The company collected $7,000 cash in partial payment from the client described in transaction g.
l. The company paid $2,400 cash for wages to a drafting assistant.
m. The company paid $2,000 cash to settle the account payable created in transaction h.
n. The company paid $1,105 cash for minor maintenance of its drafting equipment.
o. The company paid $10,170 cash in dividends.
p. The company paid $2,400 cash for wages to a drafting assistant.
q. The company paid $4,000 cash for advertisements on the web during June.
1. Prepare general journal entries to record these transactions using the following titles: Cash (101); Accounts Receivable (106); Prepaid Insurance (108); Office equipment (163); Drafting Equipment (164); Building (170); Land (172); Accounts Payable (201); Notes Payable (250); Common Stock (307); Dividends (319); Engineering Fees Earned (402); Wages Expense (601); Equipment Rental Expense (602); Advertising Expense (603); and Repairs Expense (604).
Transaction General Journal Debit Credit
a.

a. Jenna Aracel, the owner, invested $175,000 cash, office equipment with a value of $5,200, and $76,000 of drafting equipment to launch the company in exchange for common stock.

Dr Cash 175,000

Dr Office equipment 5,200

Dr Drafting equipment 76,000

    Cr Common stock 256,200

b. The company purchased land worth $56,000 for an office by paying $8,000 cash and signing a long-term not payable for $48,000.

Dr Land 56,000

    Cr Cash 8,000

    Cr Notes payable 48,000

c. The company purchased a portable building with $54,000 cash and moved it onto the land acquired in b.

Dr Building 54,000

    Cr Cash 54,000

d. The company paid $2,600 cash for the premium on an 18-month insurance policy.

Dr Prepaid insurance 2,600

    Cr Cash 2,600

e. The company completed and delivered a set of plans for a client and collected $6,200 cash.

Dr Cash 6,200

    Cr Engineering fees earned 6,200

f. The company purchased $32,000 of additional drafting equipment by paying $11,900 cash and signing a long-term not payable for $20,100.

Dr Drafting equipment 32,000

    Cr Cash 11,900

    Cr Notes payable 20,100

g. The company completed $18,000 of engineering services for a client. This amount is to be received in 30 days.

Dr Accounts receivable 18,000

    Cr Engineering fees earned 18,000

h. The company purchased $2,000 of additional office equipment on credit.

Dr Office equipment 2,000

    Cr Accounts payable 2,000

i. The company completed engineering services for $25,000 on credit.

Dr Accounts receivable 25,000

    Cr Engineering fees earned 25,000

j. The company received a bill for rent of equipment that was used on a recently completed job. The $1,409 rent cost must be paid within 30 days.

Dr Equipment rental expense 1,409

    Cr Accounts payable 1,409

k. The company collected $7,000 cash in partial payment from the client described in transaction g.

Dr Cash 7,000

    Cr Accounts receivable 7,000

l. The company paid $2,400 cash for wages to a drafting assistant.

Dr Wages expense 2,400

    Cr Cash 2,400

m. The company paid $2,000 cash to settle the account payable created in transaction h.

Dr Accounts payable 2,000

    Cr Cash 2,000

n. The company paid $1,105 cash for minor maintenance of its drafting equipment.

Dr Repairs expense 1,105

    Cr Cash 1,105

o. The company paid $10,170 cash in dividends.

Dr Dividends 10,170

    Cr Cash 10,170

p. The company paid $2,400 cash for wages to a drafting assistant.

Dr Wages expense 2,400

    Cr Cash 2,400

q. The company paid $4,000 cash for advertisements on the web during June.

Dr Advertising expense 4,000

    Cr Cash 4,000

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