Answer to Question #242060 in Accounting for Gutema

Question

1.     On March 1, 2020, Tahir Muktar, a famous businessman in Addis, opened a business named “Universal Garage” which is organized as a sole proprietorship. The business is established to render car repair, maintenance and related services for fees. Below are chart of accounts for and selected transactions completed by Universal Garage in March 2020.

Answer 1

1. Debit cache Credit settlements with the founder - 8 300

Debit materials Credit settlements with founders - 2 000

Debit Office Equipment Credit settlements with founders - 10 000

Debit settlements with founders Credit authorized capital - 20 300

2. Debit current account Credit short term loans - 5000

3. Debit payments to suppliers Credit checking account - 1800

Debit Office Equipment Credit checking account - 3600

4. Debit payments to suppliers Credit checking account -200

8. debit current account credit other income and expenses - 200

13. debit payments to staff credit checking account - 1200

16. debit cash register credit settlement with customers - 4400

20. debit payments to staff credit checking account - 1200

debit settlements with personnel customers credit revenue - 6000

21. Debit Office Equipment Credit checking account - 2000

23. Debit cache Credit settlements with the founder - 5000

Debit settlements with founders Credit authorized capital - 5000

24. Debit short term loans Credit current account- 1100

26. Debit materials Credit cache - 800

27. Debit payments to suppliers Credit checking account - 100

debit payments to staff credit checking account - 1200

31. Debit payments to suppliers Credit checking account - 400

Debit cache Credit credit customers  - 4400

Debit materials Credit cache - 1800

debit main production credit depreciation -2460