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Record the initial journal entry during the year

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Reference no: EM132582313

On January 1, you started a tutoring business called Brain Worx and charge $100 an hour for tutoring. The following are your transactions for 2017.

A. On January 1, you purchased a computer from Apple Inc. for $5,000 cash. You estimate that your computer will last four years. After that time, you will give the computer to your sister as a gift.

B. On February 1, you paid $4,300 cash for one-year of insurance coverage.

C. On March 1, you purchased supplies including paper, pens, and notebooks for $250 cash at Staples Canada Inc. At the end of the year, you had $30 of supplies left.

D. On November 1, Charlotte, a student, pays cash for nine hours of tutoring per month, for November 2017, December 2017, and January 2018.

E. You tutor George for five hours in December. However, George was away for Christmas and has promised to pay you in January 2018.

F On 31 December 2017. Telus Communications sends your December business cell phone bill for $185. The bill is due January 15, 2018. Assume Brain Worx, uses Straight Line Method to depreciate the asset.

Required

Question 1. For transactions (a) to (d), record the initial journal entry during the year.

Question 2. For transactions (a) to (f), record the adjusting entries on December 31, 2017.

Reference no: EM132582313

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