Girard Cohen Began a Computer Servicing Business and During the Month

question 131

Essay

Girard Cohen began a computer servicing business and during the month of October completed these transactions:
(a)Began business by investing cash,$12,000,and computer equipment with a fair value of $3,000.
(b)Paid rent for one year in advance,$6,000.
(c)Completed a computer servicing assignment and billed the client for $3,000.
(d)Paid the utilities bill for the month,$100.
(e)Wrote a $1,000 cheque on the business bank account for personal expenses.
Prepare journal entries to record the above transactions.Include a brief description for each entry.

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Definitions:

Revenues

Revenues refer to the total income generated by a company from its normal business operations, such as the sale of goods or provision of services.

Reversing Entries

Accounting entries that are made at the beginning of an accounting period to reverse or cancel out adjusting entries made at the end of the previous accounting period.

Bookkeeping Procedure

The systematic recording of financial transactions and maintenance of financial records in a business.

Worksheet

A document or tool used for planning, calculating, or recording information, especially in accounting.