Accounting Exercise 4.1 (Double-entry Accounting System)
The following transaction presented in the general journal refer to Musky Consulting Company's 20X8 accounting period:
| Date |
Account titles |
Debit |
Credit |
| Jan. 5 |
Cash Contributed Capital |
X | X |
| May 11 |
Cash Notes Payable |
X | X |
| May 27 |
Land Cash Notes Payable |
X | X X |
| April 13 |
Accounts Receivable Consulting Revenue |
X | X |
| June 4 |
Notes Payable Cash |
X | X |
| July 16 |
Operating Expense Cash |
X | X |
| Aug. 5 |
Cash Accounts Receivable |
X | X |
| Aug. 12 |
Distributions Cash |
X | X |
| Aug. 26 |
Notes Receivable Cash |
X | X |
| Sept. 15 |
Car Cash |
X | X |
| Nov. 2 |
Cash Unearned Revenue |
X | X |
| Nov. 29 |
Interest Payable Cash |
X | X |
| Dec. 31 |
Rent Expense Prepaid Rent |
X | X |
| Dec. 31 |
Unearned Revenue Consulting Revenue |
X | X |
| Dec. 31 |
Depreciation Expense Accumulated Depreciation |
X | X |
| Dec. 31 |
Supplies Expense Supplies |
X | X |
Required:
For each transaction provide a short explanation. Show the effect of each transaction on the elements of financial statements in a horizontal statements model. Indicate whether the event acts to increase (+), decrease (-), or does not affect (n/a) the element of the financial statements. Determine if a transaction is included into the financing (FA), operating (OA), or investing (IA) section of the statement of cash flows. An example is below:
| Assets |
= |
Liabilities |
+ |
Equity |
Rev. |
- |
Exp. |
= |
Net Inc. |
Cash Flow |
|
| + |
|
n/a |
|
+ |
n/a |
|
n/a |
|
n/a |
+ |
FA |
Location