Novak Computer had the following transactions during the month of May.
- Purchased equipment on account for $8,600.
- Paid $1,800 for rent for the month of May.
- Performed computer services for $3,950 on account.
- Paid Buffalo Hydro $500 cash for utilities used in May.
- Borrowed $20,000 from the bank.
- Paid supplier for equipment purchased in transaction (1).
- Purchased a one-year insurance policy for $450 cash.
- Received $3,050 cash in partial payment of the account owed in transaction (3).
- Declared and paid $590 of dividends to stockholders.
- Paid incomes taxes of $310 for the month.
Journalize the above transactions. (If no entry is required, select “No Entry” for the account titles and enter O for the amounts. Credit account titles are automatically indented indent manually. Record journal entries in the order presented in the problem. List all debit entries before credit entries.)
Solution
| Transaction # | Account | Dr | Cr |
| 1 | Equipment | $8,600 | |
| Accounts Payable | $8,600 | ||
| 2 | Rent Expense | $1,800 | |
| Cash | $1,800 |
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