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Word Avreet Hothi thothia an Layout References Mailings Review View Help Acrobat Question 4 Listed are the April 2020 transactions for Whitters Bike Ltd
Word Avreet Hothi thothia an Layout References Mailings Review View Help Acrobat Question 4 Listed are the April 2020 transactions for Whitters Bike Ltd. Using the journal entry template provided below, prepare the journal entries: Apr 1 Issued common shares in exchange for cash of $75,000 and equipment of $25,000. Apr 1 Paid monthly rent of $1,500. Apr 4 Purchased inventory, on account for $31,350. Apr 5 Purchased office supplies for $3,000 cash. Performed bike servicing for customers in the amount of $500; received $300 in cash and Apr 11 billed customers for the remainder. Apr 17 Sold 5 bikes for cash of $15,000. Apr 22 Sold 2 bikes on account for $2,500. Apr 26 Paid $2,250 in salaries and $500 in utilities. Apr 30 collected customer payment for bikes sold on April 22. Apr 30 Remitted payment to vendor for inventory purchased on April 4.
Expert Solution
| Journal entries in the books of Whitters Bike Ltd. |
| Date | Accounts | Debit | Credit |
| Apr 1 | Cash a/c | $ 75,000 | |
| Property, plant and equipment assets a/c | $ 25,000 | ||
| To Common stock a/c | $ 100,000 | ||
| (Being common shares issued in exchange of cash of 75000 and equipment for 25000) | |||
| Apr 1 | Rent expenses a/c | $ 1,500 | |
| To Cash a/c | $ 1,500 | ||
| (Monthly rent of 1500 paid) | |||
| Apr 4 | Inventory/Supplies a/c | $ 31,350 | |
| To Accounts payable a/c | $ 31,350 | ||
| (Being inventory purchased on credit) | |||
| Apr 5 | Property, plant and equipment assets a/c | $ 3,000 | |
| To Cash | $ 3,000 | ||
| (Being office supplies assets purchased in cash) | |||
| Apr 5 | Cash A/c | $ 300 | |
| Sundry Debtors/ Accounts Receivable A/c | $ 200 | ||
| To Bike Service Revenue a/c | $ 500 | ||
| (Being bike service performed for customers, 300 in cash and the balance on account) | |||
| Apr 11 | Inventory/Supplies a/c | $ 31,350 | |
| To Accounts payable a/c | $ 31,350 | ||
| (Being inventory purchased on credit) | |||
| Apr 17 | Cash a/c | $ 15,000 | |
| To Bike Sales revenue a/c | $ 15,000 | ||
| (Being bike sales revenue received in cash) | |||
| Apr 22 | Sundry Debtors/ Accounts Receivable A/c | $ 2,500 | |
| To Bike Sales revenue a/c | $ 2,500 | ||
| (Being bike sales revenue received on account) | |||
| Apr 26 | Salaries a/c | $ 2,250 | |
| Utilities a/c | $ 500 | ||
| To Cash a/c | $ 2,750 | ||
| (Being Salaries and utilities expenses paid in cash) | |||
| Apr 30 | Cash a/c | $ 2,500 | |
| To Sundry Debtors/ Accounts Receivable A/c | $ 2,500 | ||
| (Being amount due from customers received in cash) | |||
| Apr 30 | Accounts payable a/c | $ 2,500 | |
| To Cash a/c | $ 2,500 | ||
| (Being payment made to vendors in cash) |
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