Question

application problem 3 - 4.2 (static)
aug 1 mikela mundt invested $2,000.00 of her own money in the business. receipt no. 1.
3 used business cash to purchase supplies costing $216.00. wrote check no. 1.
4 wrote check no. 2 for insurance, $245.00.
5 purchased supplies for $68.00 over the phone from southern supplies, promising to send the check next week. memo no. 1.
11 sent check no. 3 to southern supplies, $68.00.
12 sent a check for the electricity bill, $180.00. check no. 4.
15 wrote $800.00 check to ms. mundt as a withdrawal of equity for personal use. used check no. 5.
16 sold services for $412.00 to j. lepowsky, who agreed to pay for them within ten days. sales invoice no. 1.
17 recorded cash sales of $1,179.00. calculator tape dated march 17. t17
18 paid $132.00 for advertising. wrote check no. 6.
using the information provided for mundt services, journalize the transactions completed during august of the current year. use page 1 of the journal. remember to record appropriate source document numbers.
journal
date account title doc. no. post. ref. general debit credit sales credit cash debit credit

Explanation:

Step1: Record owner's investment

Debit Cash $2,000.00 (increase in asset), Credit Owner's Equity $2,000.00 (increase in equity), Doc No. Receipt No 1.

Step2: Record supply purchase

Debit Supplies $216.00 (increase in asset), Credit Cash $216.00 (decrease in asset), Doc No. Check No 1.

Step3: Record insurance payment

Debit Insurance Expense $245.00 (increase in expense), Credit Cash $245.00 (decrease in asset), Doc No. Check No 2.

Step4: Record supply purchase on account

Debit Supplies $68.00 (increase in asset), Credit Accounts Payable $68.00 (increase in liability), Doc No. Memo No 1.

Step5: Record payment to supplier

Debit Accounts Payable $68.00 (decrease in liability), Credit Cash $68.00 (decrease in asset), Doc No. Check No 3.

Step6: Record electricity bill payment

Debit Utilities Expense $180.00 (increase in expense), Credit Cash $180.00 (decrease in asset), Doc No. Check No 4.

Step7: Record owner's withdrawal

Debit Owner's Withdrawals $800.00 (decrease in equity), Credit Cash $800.00 (decrease in asset), Doc No. Check No 5.

Step8: Record credit sales

Debit Accounts Receivable $412.00 (increase in asset), Credit Sales Revenue $412.00 (increase in revenue), Doc No. Sales Invoice No 1.

Step9: Record cash sales

Debit Cash $1,179.00 (increase in asset), Credit Sales Revenue $1,179.00 (increase in revenue), Doc No. Calculator tape T17.

Step10: Record advertising payment

Debit Advertising Expense $132.00 (increase in expense), Credit Cash $132.00 (decrease in asset), Doc No. Check No 6.

DATE	ACCOUNT TITLE	DOC NO.	POST REF.	GENERAL DEBIT	GENERAL CREDIT	SALES CREDIT	CASH DEBIT	CASH CREDIT
Aug 1	Owner's Equity	Receipt No 1			2000.00
Aug 3	Supplies	Check No 1		216.00				216.00
Aug 3	Cash	Check No 1			216.00			216.00
Aug 4	Insurance Expense	Check No 2		245.00				245.00
Aug 4	Cash	Check No 2			245.00			245.00
Aug 5	Supplies	Memo No 1		68.00
Aug 5	Accounts Payable	Memo No 1			68.00
Aug 11	Accounts Payable	Check No 3		68.00				68.00
Aug 11	Cash	Check No 3			68.00			68.00
Aug 12	Utilities Expense	Check No 4		180.00				180.00
Aug 12	Cash	Check No 4			180.00			180.00
Aug 15	Owner's Withdrawals	Check No 5		800.00				800.00
Aug 15	Cash	Check No 5			800.00			800.00
Aug 16	Accounts Receivable	Sales Invoice No 1		412.00
Aug 16	Sales Revenue	Sales Invoice No 1			412.00	412.00
Aug 17	Cash	Calculator tape T17		1179.00			1179.00
Aug 17	Sales Revenue	Calculator tape T17			1179.00	1179.00
Aug 18	Advertising Expense	Check No 6		132.00				132.00
Aug 18	Cash	Check No 6			132.00			132.00

Answer:

The journal entries are shown in the above - table with appropriate debits and credits for each transaction along with the relevant document numbers.