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New Member
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May 6, 2007, 04:20 PM
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journal entry
Do I record deprication in the following question
Purchased supplies at a cost of 14,000. Assume the above items have a 2 year life with no salvage value.
And also how do I record this
Invested 80,000 of your own money to start the business
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Ultra Member
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May 6, 2007, 06:47 PM
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One typically does not record depreciation on supplies.
The biggest reason is that it usually is not material.
Also supplies usually don't last for a long time.
Investing 80,000 of your own money…
Dr. Cash 80,000
Cr. Equity/Donated Capital/Shares 80,000
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New Member
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May 6, 2007, 07:02 PM
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It actually said a printer and a scanner for the supplies
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Ultra Member
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May 6, 2007, 07:12 PM
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Oh, well that could be qualified as Equipment then. Since when does a printer and scanner only last for 2 years?
In that case, assuming 14,000 is material to your company, I would depreciate it.
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New Member
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May 6, 2007, 07:51 PM
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How do you write that?
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Ultra Member
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May 7, 2007, 12:33 AM
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When you but the Equipment for 14,000 the JE would be:
Dr. Equipment 14,000
Cr. Cash 14,000
After year 1 and after year 2, the JE is the same:
Dr. Depreciation Expense 7,000
Cr. Accumulated Depreciation 7,000
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New Member
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May 7, 2007, 11:08 AM
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THANK YOU!!
OK I have another question. How do you write the adjusted journal entry for
DR:cash 80000
CR:capital 80000
And also
DR:cash 6000
CR:revenue 6000
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Ultra Member
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May 7, 2007, 04:20 PM
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Originally Posted by jsu4549m
THANK YOU!!!
ok i have another question. how do you write the adjusted journal entry for
DR:cash 80000
CR:capital 80000
and also
DR:cash 6000
CR:revenue 6000
Those 2 JE do not require any adjusting entries. The second one, the part dealing with Sales, that account has to be closed to Retained Earnings at the end of the year.
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New Member
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May 7, 2007, 04:43 PM
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OK I'm sooo sorry but I have another question
It says purchased 1,200 worth of supplies for cash
So DR: supplies and CR: cash
Then for my adjusting entry I DR:supplies and CR: supplies expense
I don't think that is right, let me know what you think
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Ultra Member
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May 7, 2007, 07:07 PM
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Originally Posted by jsu4549m
ok im sooo sorry but i have another question
it says purchased 1,200 worth of supplies for cash
so DR: supplies and CR: cash
then for my adjusting entry i DR:supplies and CR: supplies expense
i dont think that is right, let me know what u think
You have the first JE correct.
The second one, you need to reverse it. Debit Supplies Expense and Credit Supplies.
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New Member
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May 7, 2007, 07:25 PM
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OK one more I have DR:cash CR:AR for my JE
And DR:AR CR:revenue for my adjusting entry is that right
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Ultra Member
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May 7, 2007, 08:18 PM
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Originally Posted by jsu4549m
ok one more i have DR:cash CR:AR for my JE
and DR:AR CR:revenue for my adjusting entry is that right
I don't follow this.
What was the transaction all about?
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New Member
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May 7, 2007, 08:19 PM
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It said... collected 8,000 from the client billed earlier, which said provided services for a client. Sent him a bill for 15,000
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Ultra Member
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May 7, 2007, 09:34 PM
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Ok, so when you send the bill to the customer:
Dr. AR 15,000
Cr. Sales 15,000
When you received the cash…
Dr. Cash 8,000
Cr. AR 8,000
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New Member
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May 7, 2007, 09:37 PM
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OK I got that but how do you do an adjusting entry for the DR:cash 8000 CR:AR 8000
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Ultra Member
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May 7, 2007, 09:56 PM
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What do you mean?
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Junior Member
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May 7, 2007, 10:00 PM
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80000.00 is owners equity.
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New Member
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May 7, 2007, 10:04 PM
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Don't you have to do an adjusting entry if it's a cash entry
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Ultra Member
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May 7, 2007, 10:45 PM
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No.
The "adjustment" would be you get cash, and you draw down the AR you set up with the sale.
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New Member
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May 8, 2007, 08:05 AM
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OK I can't get this, I'm supposed to make adjusting entries to these things if needed and she said there was 11
DR:cash 80000
CR:capital 80000
DR:cash 30000 this was borrowed 30000 from bank by sugning a 6 month 10% note
CR:NP 30000
DR:Prepaid rent 6000
CR:cash 6000
DR:prepaid ins. 2400
CR:cash 2400
DR:Equipment 14000 this one had 2 year life
CR:cash 14000
DR:equipment 5000 this one had 5 year life
CR:cash 5000
DR:advertising exp 6000
CR:cash 6000
DR:supplies 2000
CR:AP 2000
DR:cash 6000
CR:revenue 6000
DR:AR 15000
CR:revenue 15000
DR:salary exp 1500
CR:cash 1500
DR:supplies 1200
CR:cash 1200
DR:cash 8000
CR: 8000
DR:AP 2000
CR:cash 2000
DR:cash 20000
CR:unearned rev 20000
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