Problem 3-5A (Algo) Applying the accounting cycle LO P1, P3, P4, P5, P6 On April 1, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first month. April 2 Nozomi invested \( \$ 37,000 \) cash and computer equipment worth \( \$ 25,000 \) in the company in exchange for its common stock. April 3 The company rented furnished office space by paying \( \$ 2,500 \) cash for the first month's (April) rent. April 4 The company purchased \( \$ 1,400 \) of office supplies for cash. April 10 The company paid \( \$ 2,160 \) cash for a \( 12- \) month insurance policy. Coverage begins on April 11 . April 14 The company paid \( \$ 1,400 \) cash for two weeks' salaries earned by employees. April 24 The company collected \( \$ 10,000 \) cash for commissions revenue. April 28 The company paid \( \$ 1,400 \) cash for two weeks' salaries earned by employees. April 29 The company paid \( \$ 550 \) cash for minor repairs to computer equipment. April 30 The company paid \( \$ 1,000 \) cash for this month's telephone bill. April 30 The company paid \( \$ 1,600 \) cash in dividends.
Solución de inteligencia artificial de Upstudy
Responder
Solución

¡Inicia sesión para desbloquear respuestas gratis!
Una plataforma de aprendizaje en la que confían millones de estudiantes y profesores reales.

Respondido por UpStudy AI y revisado por un tutor profesional
Extra Insights
Creating a new travel agency is exciting, but it also comes with its share of fundamental accounting practices! Understanding how each transaction affects your accounting equation (Assets = Liabilities + Equity) is key. Each entry in the accounting journal not only keeps track of income and expenses but also lays the groundwork for your financial statements at month-end. Properly logging these transactions can help you stay on top of cash flow, spotting trends, and preparing for tax time like a pro! When working through the accounting cycle, one common mistake is failing to record transactions in the correct period. For instance, that cash paid for the 12-month insurance policy should be accounted as a prepaid expense. This helps in spreading the cost over time, ensuring your financial statements reflect accurate monthly expenses. Also, be careful with dividends; they reduce retained earnings and must be tracked distinctly. Remember, bookkeeping is both an art and a science—stay organized, and you’ll paint a beautiful picture of your business’s financial health!
