Wickers Restoration Services had the following transactions on May.

Received from sale of common stock.

Paid rent on office for the month, .

Purchased supplies on account, .

Earned fees, receiving cash, .

Paid creditor on account, .

Paid automobile expenses for month, , and miscellaneous expenses, .

Paid office salaries for the month, .

Earned fees that the customer will pay next month, .

Determined that the cost of supplies used was .

Paid dividends, .
a. Prepare the journal entries for the above transactions on May. If an amount box does not require an entry, leave is blank.

?

Ask by Craig Ingram. in the United States

Jan 25,2025

Question

Wickers Restoration Services had the following transactions on May.

Received from sale of common stock.

Paid rent on office for the month, .

Purchased supplies on account, .

Earned fees, receiving cash, .

Paid creditor on account, .

Paid automobile expenses for month, , and miscellaneous expenses, .

Paid office salaries for the month, .

Earned fees that the customer will pay next month, .

Determined that the cost of supplies used was .

Paid dividends, .
a. Prepare the journal entries for the above transactions on May. If an amount box does not require an entry, leave is blank.

?

Ask by Craig Ingram. in the United States

Jan 25,2025

UpStudy AI · Accepted Answer

Certainly! Below are the journal entries for Wickers Restoration Services for the transactions that occurred in May. Each entry includes the accounts debited and credited along with the corresponding amounts.

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### a. Journal Entries for May

1. **Received \$48,000 from sale of common stock.**
   ```
   Debit: Cash .................................... $48,000
       Credit: Common Stock ............................ $48,000
   ```

2. **Paid rent on office for the month, \$880.**
   ```
   Debit: Rent Expense ............................. $880
       Credit: Cash ........................................ $880
   ```

3. **Purchased supplies on account, \$1,750.**
   ```
   Debit: Supplies .................................. $1,750
       Credit: Accounts Payable .......................... $1,750
   ```

4. **Earned fees, receiving cash, \$12,600.**
   ```
   Debit: Cash .................................... $12,600
       Credit: Service Revenue ............................ $12,600
   ```

5. **Paid creditor on account, \$1,000.**
   ```
   Debit: Accounts Payable .................... $1,000
       Credit: Cash ........................................ $1,000
   ```

6. **Paid automobile expenses for month, \$375, and miscellaneous expenses, \$250.**
   ```
   Debit: Automobile Expense ................... $375
   Debit: Miscellaneous Expense .............. $250
       Credit: Cash ........................................ $625
   ```

7. **Paid office salaries for the month, \$3,900.**
   ```
   Debit: Salaries Expense ...................... $3,900
       Credit: Cash ........................................ $3,900
   ```

8. **Earned fees that the customer will pay next month, \$2,400.**
   ```
   Debit: Accounts Receivable ............... $2,400
       Credit: Service Revenue ............................ $2,400
   ```

9. **Determined that the cost of supplies used was \$280.**
   ```
   Debit: Supplies Expense ....................... $280
       Credit: Supplies .................................... $280
   ```

10. **Paid dividends, \$2,400.**
    ```
    Debit: Dividends ................................ $2,400
        Credit: Cash ........................................ $2,400
    ```

---

**Notes:**

- **Debits and Credits:** In each journal entry, the total debits equal the total credits, maintaining the accounting equation's balance.
  
- **Accounts Explained:**
  - **Cash:** Asset account increasing with debits and decreasing with credits.
  - **Common Stock:** Equity account; issuing stock increases equity.
  - **Rent Expense, Salaries Expense, Automobile Expense, Miscellaneous Expense, Supplies Expense:** Expense accounts reducing equity.
  - **Supplies:** Asset account; purchasing supplies increases assets, using supplies decreases assets.
  - **Accounts Payable:** Liability account; purchasing on account increases liabilities, paying reduces them.
  - **Service Revenue:** Revenue account increasing equity.
  - **Accounts Receivable:** Asset account representing money to be received.
  - **Dividends:** Distribution to shareholders, reducing retained earnings (equity).

Ensure that these entries are posted to the general ledger accordingly to maintain accurate financial records.
Here are the journal entries for Wickers Restoration Services for May: 1. **Received \$48,000 from sale of common stock.** ``` Debit: Cash $48,000 Credit: Common Stock $48,000 ``` 2. **Paid rent on office for the month, \$880.** ``` Debit: Rent Expense $880 Credit: Cash $880 ``` 3. **Purchased supplies on account, \$1,750.** ``` Debit: Supplies $1,750 Credit: Accounts Payable $1,750 ``` 4. **Earned fees, receiving cash, \$12,600.** ``` Debit: Cash $12,600 Credit: Service Revenue $12,600 ``` 5. **Paid creditor on account, \$1,000.** ``` Debit: Accounts Payable $1,000 Credit: Cash $1,000 ``` 6. **Paid automobile expenses for month, \$375, and miscellaneous expenses, \$250.** ``` Debit: Automobile Expense $375 Debit: Miscellaneous Expense $250 Credit: Cash $625 ``` 7. **Paid office salaries for the month, \$3,900.** ``` Debit: Salaries Expense $3,900 Credit: Cash $3,900 ``` 8. **Earned fees that the customer will pay next month, \$2,400.** ``` Debit: Accounts Receivable $2,400 Credit: Service Revenue $2,400 ``` 9. **Determined that the cost of supplies used was \$280.** ``` Debit: Supplies Expense $280 Credit: Supplies $280 ``` 10. **Paid dividends, \$2,400.** ``` Debit: Dividends $2,400 Credit: Cash $2,400 ``` **Notes:** - Each entry maintains the accounting equation by ensuring that debits equal credits. - Accounts like Cash, Common Stock, Rent Expense, Supplies, Accounts Payable, Service Revenue, Accounts Receivable, Salaries Expense, Automobile Expense, Miscellaneous Expense, Supplies Expense, and Dividends are appropriately debited and credited based on the nature of each transaction.

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