Reference no: EM132648303

Question 1: Make a Transaction Description of transaction for a journal entry for the journal entry.

The annual interest rate on the mortgage payable was 9.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16.

Other transactions:

01. June 1: Jeremy made an investment in Byte of Accounting, Inc., by purchasing 2,630 shares of its common stock paying $33,011.00 in cash and by contributing computer equipment with a fair market value of $45,915.30. The par value of the common stock was $0.01 per share.

02. June 1: Courtney made an investment in Byte of Accounting, Inc., by purchasing 561 shares of its common stock by contributing computer equipment with a fair market value of $15,605.20 and office equipment with a fair value of $1,230.41. The par value of the common stock was $0.01 per share.

03. June 1: Clair made an investment in Byte of Accounting, Inc. by purchasing 4,150 shares of its common stock for $124,541.50 cash. The par value of the common stock was $0.01 per share.

04. June 2: Check # 5002 was used to make a down payment of $36,000.00 on additional computer equipment that was purchased from Royce Computers, invoice number 76542. The full price of the computer was $180,000.00. A five-year note was executed by Byte for the balance.

05. June 4: Additional office equipment costing $500.00 was purchased on credit from Discount Computer Corporation. The invoice number was 98432.

06. June 8: Unsatisfactory office equipment costing $100.00 from invoice number 98432 was returned to Discount Computer for credit to be applied against the outstanding balance owed by Byte.

07. June 10: Check # 5003 was used to make a $27,500.00 payment reducing the principal owed on the June 2 purchase of computer equipment from Royce Computers.

08. June 10: Purchased office supplies for $1,700.00 from Staples on account. The invoice number was 61298. Included in the purchase was 10 units of Super RoutePro at a cost of $40.00 each.

09. June 14: Check # 5004 was used to purchase a one-year insurance policy covering its computer equipment for $5,472.00 from Seth's Insurance. The effective date of the policy was June 16 and the invoice number was 2387.

10. June 16: Checks in the amount of $8,510.00 was received for services performed for cash customers.

11. June 16: Byte purchased a building and the land it is on for $119,000.00 to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $19,000.00. The balance of the cost is to be allocated to the building. Check # 5005 was used to make the down payment of $11,900.00. A thirty year mortgage with an inital payement due on August 1st, was established for the balance.

12. June 17: Check # 5006 for $6,900.00 was paid for rent of the office space for June, July and August.

13. June 17: Received invoice number 26354 in the amount of $475.00 from the local newspaper for advertising.

14. June 21: Billed various miscellaneous local customers $4,700.00 for consulting services performed.

15. June 21: Check # 5007 was used to purchase a fax machine for the office from Office Machines Express for $825.00. The invoice number was 975-328.

16. June 21: Accounts payable in the amount of $400.00 were paid with Check # 5008.

17. June 22: Check # 5009 was used to pay the advertising bill that was received on June 17.

18. June 22: Received a bill for $1,240.00 from Computer Parts and Repair Co. for repairs to the computer equipment. The invoice number was 43254.

19. June 22: Check # 5010 was used to pay salaries of $960.00 to equipment operators for the week ending June 18. Ignore payroll taxes.

20. June 23: Cash in the amount of $3,765.00 was received on billings.

21. June 23: Purchased office supplies for $850.00 from Staples on account. The invoice number was 65498. Included in the purchase was 10 units of Super RoutePro at a cost of $45.00 each.

22. June 28: Billed $5,805.00 to miscellaneous customers for services performed to June 25.

23. June 29: Cash in the amount of $5,500.00 was received for billings.

24. June 29: Paid the bill received on June 22, from Computer Parts and Repairs Co with Check # 5011.

25. June 29: Check # 5012 was used to pay salaries of $960.00 to equipment operators for the week ending June 25. Ignore payroll taxes.

26. June 30: Received a bill for the amount of $990.00 from O & G Oil and Gas Co. The invoice number was 784537.

27. June 30: Check # 5013 was used to pay for a cash dividend of $0.20 per share to Jeremy, a shareholder of Byte.

28. June 30: Check # 5014 was used to pay for a cash dividend of $0.20 per share to Clair a shareholder of Byte.

29. June 30: Check # 5015 was used to pay for a cash dividend of $0.20 per share to Courtney, a shareholder of Byte.