Answer to Question #252906 in Accounting for abi

Question

f. AH forecasted that services fees in the next two weeks will amount to $5,000.

g. AH received $10,000 additional cash investment from its owner (Cash receipt note #1).

h. AH rendered consultancy services worth $15,000 to clients who promised to pay the sum within a month (Credit sales invoice #1).

i. AH sold one of the furniture invested by its owner for $5,000 cash (Cash receipt note #2). The furniture had a recorded value of $5,000.

j. AH collected $5,000 cash from clients who received services in item-8 above (Cash receipt note #3).

k. AH paid $2,000 cash to suppliers on credit (Cash payment voucher #2).

Answer 1

Solution:

The journal entries for AH for the above transactions are as follows:

f.). No journal entry required. A journal entry cannot be made for forecasted figures.

 

g.). Dr. Cash A/c                                          10,000

                   Cr. Owner’s Equity A/c                                        10,000

(Being additional cash investment by the owner)

 

h.). Dr. Accounts Receivable A/c                15,000

                Cr. Sales A/c                                                           15,000

(Being revenue services rendered on credit)

 

i.). Dr. Cash A/c                                            5,000

                  Cr. Furniture A/c                                                     5,000

(To record the cash sale of furniture)

 

j.). Dr. Cash A/c                                            5,000

                  Cr. Accounts Receivable A/c                                   5,000

(To record accounts receivable received)

 

k.). Dr. Accounts Payable A/c                        2,000

                   Cr. Cash A/c                                                         2,000

(To record payment to credit suppliers)