Case Scenario:
Jill and Phil have just established a security alarm maintenance service. They charge $20 per hour per person and are usually paid by check upon completion of the job. For certain customers, they send a bill immediately and are paid promptly by return mail. Their out-of-pocket expenses are rather low – usually only supplies and transportation. Following are the entries to the accounting system that were made for the first 12 transactions of the company.
(Balance Sheet Accounts) (Income Statement Accounts)
|
|
Account
|
Cash
|
+ Other Assets
|
= Liabilities
|
+ Equity
|
+
Revenues
|
-Expenses
|
|
A.
|
Cash Investment by Owner
|
200
|
|
|
200
|
|
|
|
B.
|
Cash Supplies
|
-115
|
115
|
|
|
|
|
|
C.
|
Cash Notes Payable
|
391
|
|
391
|
|
|
|
|
D.
|
Cash Supplies
|
-80
|
80
|
|
|
|
|
|
E.
|
Cash Accounts Receivable Sales
|
390
|
160
|
|
|
550
|
|
|
F.
|
Cash Notes payable
|
-300
|
|
-300
|
|
|
|
|
G.
|
Cash Accounts Receivable
|
100
|
100
|
|
|
|
|
|
H.
|
Supplies Expense
|
|
-55
|
|
|
|
-55
|
|
I.
|
Supplies Expense
|
|
-65
|
|
|
|
-65
|
|
J.
|
Cash Accounts Receivable Sales
|
575
|
150
|
|
|
725
|
|
|
K.
|
Cash Accounts Receivable
|
90
|
-90
|
|
|
|
|
|
I.
|
Cash Retained Earnings
|
-800
|
|
|
-800
|
|
|
For each Transaction, describe the event (including amounts that caused the entry to be made.