Question

name date class part three—recording transactions in a general journal directions: analyze each of the following transactions into debit and credit parts and choose account titles from the list below. print the letters identifying your choices in the proper answers columns. account titles a. accounts payable—casey company c. advertising expense g. prepaid insurance b. accounts receivable—t. sundeen d. cash e. david dumire, capital f. david dumire, drawing h. sales i. supplies j. utilities expense answers debit credit 1–2. received cash from owner, david dumire, as an investment. (p. 62) 1. 2. 3–4. paid cash for supplies. (p. 63) 3. 4. 5–6. paid cash for insurance. (p. 65) 5. 6. 7–8. bought supplies on account from casey company. (p. 66) 7. 8. 9–10. paid cash on account to casey company. (p. 67) 9. 10. 11–12. received cash from sales. (p. 70) 11. 12. 13–14. sold services on account to t. sundeen. (p. 71) 13. 14. 15–16. paid cash for advertising expense. (p. 72) 15. 16. 17–18. received cash on account from t. sundeen. (p. 73) 17. 18. 19–20. paid cash to owner, david dumire, for a withdrawal of equity. (p. 74) 19. 20.

Explanation:

1-2. Received cash from owner, David Dumire, as an investment.

Step1: Analyze debit part.

When the owner invests cash, the Cash account (D) increases, so we debit Cash.

Step2: Analyze credit part.

The owner's investment increases the owner's capital, so we credit David Dumire, Capital (E).

Step1: Analyze debit part.

Buying supplies increases the Supplies (I) account, so we debit Supplies.

Step2: Analyze credit part.

Paying cash decreases the Cash (D) account, so we credit Cash.

Step1: Analyze debit part.

Prepaid Insurance (G) is an asset that increases when we pay for insurance in advance, so we debit Prepaid Insurance.

Step2: Analyze credit part.

Paying cash decreases the Cash (D) account, so we credit Cash.

Answer:

1. D. Cash
2. E. David Dumire, Capital

3-4. Paid cash for supplies.