Exercises E3-4 & E3-9

Complete Exercises E3-4 & E3-9.
E3-4 Instructions
(a) Describe each transaction.

1. The organization issued shares of stock to stockholders for $20,000 cash
2. The organization bought $5,000 machines on account with $1,000 paid in cash accruing a balance of $4,000
3. The organization paid $750 for materials
4. The organization receives $4,100 of cash in return for services provided, together with charging $5,400 from
5. The organization paid $1,500 with cash on accounts payable.
6. The organization paid a $2,000 dividend.
7. The organization paid $800 for this month rent.
8. The organization receives $450 from a consumer.
9. The organization pays the earnings of workers in wages of $3,000.
10. The organization pays $300 on amenities account.

(b) Determine how much stockholders’ equity increased for the month.

The shareholders equity raised $3,400. This is computed from assets less debts.

(c) Compute the net income for the month.
The net income is $5,400. Which are revenues less expenditures.

E3-9 The May transactions of StepAside Corporation were as follows.
May 4 Paid $700 due for supplies previously purchased on account.
7 Performed advisory services on account for $6,800.
8 Purchased supplies for $850 on account.
9 Purchased equipment for $1,000 in cash.
17 Paid employees $530 in cash.
22 Received bill for equipment repairs of $900.
29 Paid $1,200 for 12 months of insurance policy. Coverage begins June 1.

Instructions: Journalize the transactions. Do not provide explanations.

Date
Account Title
Debit
Credit
May 4
Accounts Payable
$700

Cash

$700
7
Service Income
$6,800

Accounts Receivable

$6,800
8
Materials
$850

Accounts Payable

$850
9
Machines
$1,000

Cash

$1,000
17
Wages Expenditure
$530

Cash

$530
22
Cash
$900

Accounts Payable

$900
29
Prepaid Insurance
$1,200

Cash

$1,200

Complete Problems 3-5A & 3-6A.

3-5A Instructions
(a)