Ask Me Help Desk

Ask Me Help Desk (https://www.askmehelpdesk.com/forum.php)
-   Finance & Accounting (https://www.askmehelpdesk.com/forumdisplay.php?f=411)
-   -   Journalizing transaction (https://www.askmehelpdesk.com/showthread.php?t=318750)

  • Feb 17, 2009, 07:47 PM
    kosky52
    Journalizing transaction
    Otis Carpenter opened a medical practice in Alexandria, VA

    Sept 1 The business received $33,000 cash and gave capital to the owner.

    Sept 2 Purchased medical supplies on account $7,000

    Sept 2 Paid monthly office rent of $3,700

    Sept 3 Recorded $10,000 revenue for service rendered to patients on account.
  • Feb 18, 2009, 02:08 PM
    pready

    Sep 1. Where did the cash come from?
    If from a loan, then the entry is:
    Debit Cash for the amount
    Credit Notes Payable for the amount

    If the owner invested the cash, then the entry is:
    Debit Cash for the amount
    Credit Owner's Equity for the amount

    Sep 2:
    Debit Medical Supplies for the amount
    Credit Accounts Payable for the amount

    Sep 2:
    Debit Rent Expense for the amount
    Credit Cash for the amount

    Sep 3:
    Debit Accounts Receivable for the amount
    Credit Service Revenue for the amount

    I am assuming this is a for profit company.

    Medical companies usually follow Non-profit or Govenmental accounting.

  • All times are GMT -7. The time now is 11:05 AM.