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Homework answers / question archive / The following transactions occur for the Panther Detective Agency during the month of July: 1
The following transactions occur for the Panther Detective Agency during the month of July: 1. Purchase a truck and sign a note payable, $14.700. 2. Purchase office supplies for cash, $570. 3. Pay $770 in rent for the current month. Record the transactions. The company uses the following accounts: Cash, Supplies, Equipment for the truck). Notes Payable, and Rent Expense. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Answer is not complete. No Transaction General Journal Debit Credit 01 Equipment 14,700 1 o 0 2 02 Supplies 570 3 03 Rent Expense 770
a. Purchased a truck and signed notes payable for $14,700:
The following is the accounting equation for the entry:
Assets = Liabilities + Stakeholder's Equity
Asset = Equipment
Liability = Notes Payable
Equipment (A+)Dr. 14,700
Notes payable (L+)Cr. 14,700
(To record the purchase of supplies)
Equipment is an asset and increased by $14,70. Therefore, debit equipment account with $14,700.
Notes payable is a liability and increased by $14,700. Therefore, credit the notes payable account
B. Purchased supplies for cash, $570:
The following is the accounting equation for the entry:
Asset = Supplies 570+ Cash 570-
Supplies (A+)Dr. 570
Cash a/c Cr.. 570
(To record the purchase of supplies)
Supplies are an asset and increased by $570. Therefore, debit supplies account with $570.
Cash is an asset and decreased by $570. Therefore, credit cash account with $570.
(c) Paid rent expenses of $770.
The following is the accounting equation for the entry:
Asset = Cash 770-
Shareholder's Equity = Rent Expenses 770+
Rent Expense Dr. 770
Cash Cr.. 770
(To record the payment of repair expense)
Rent expense is an expense and increased by $770. Therefore, debit Rental expense account with $770.
Cash is an asset and decreased by $770. Therefore, credit cash account with $770.
