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    derek10rr3's Avatar
    derek10rr3 Posts: 3, Reputation: 1
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    #1

    Jun 28, 2008, 01:15 PM
    General Journal/cash
    Hello,

    I just started an intro to accounting course, and have read all about the different journals.

    However, my first task is to enter transactions into the general journal, and I have been given the chart of accounts to use.

    Therefore, each transaction belongs in the GJ, and not anywhere else.

    Now, my question is this, I have a transaction that states: Company A purchases computer for cash.

    I do not have a cash asset account; I only have cheque account, petty cash, and A/R.

    I have Computer Equip at Cost, and Computer Equip Accum Dep'n for the other side of the transaction.

    Would I just debit the cheque account and cr my comp equip at cost?


    Also, What are the rules for contributing an assest, i.e. vehicle, computer, to the company for use?

    Does this involve a decrease in O/E, i.e. a debit to drawings?

    Any responses to these questions is greatly appreciated.
    Criado's Avatar
    Criado Posts: 142, Reputation: 15
    Junior Member
    		  
    #2

    Jun 28, 2008, 08:20 PM
    Would I just debit the cheque account and cr my comp equip at cost? Correct!

    What are the rules for contributing an assest, i.e. vehicle, computer, to the company for use? Does this involve a decrease in O/E, i.e. a debit to drawings?
    In contributing an asset for Company's use, regardless of type, you should debit the asset account and credit the O/E account, that is, credit to Capital.
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