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PROBLEM $08-$ ACCOUNTING CYCLE

The Electronics Appliance Corporation was organized on September $1$ The following

transactions occurred during the month of September:

$(1)$ The firm issues $4/000$ no$-$par$-$value common shares for $$12$ cash per share on

September $1$

$(2)$ The firm's lawyer is given $600$ no$-$par$-$value common shares on September $2$ in

payment for legal services rendered in the organization of the corporation. The bill

for the services is $$7,200.$

$(3)$ A factory building is leased for the three years beginning October $1.$ Monthly rental

payments are $$5,000.$ Two months' rent is paid in advance on September $5.$

$(4)$ Raw materials are purchased on account for $$6,100$ on September $12.$

$(5)$ A cheque for $5900$ is received on September $15$ from a customer as a deposit on a

special order for equipment that Electronics plans to manufacture. The contract price

is $$4,800.$

$(6)$ Office equipment with a list price of $$950$ is acquired on September $20.$ After

deducting a discount of $$25$ for prompt payment, a cheque is issued in full payment.

$(7)$ The company hires three employees to begin work on October $1.$ A cash advance of

$$200$ is given to one of the employees on September $28.$

$(8)$ Factory equipment costing $$27,500$ is purchased on September $30.$ A cheque for

$$5,000$ is issued, and a long$-$term mortgage liability is assumed for the balance.

$(9)$ The labour costs of installing the new equipment in $(8)$ are $$450$ and are paid in cash

on September $30.$

Required:

a$.$ Prepare journal entries for each of the nine transactions

b$.$ Set up T accounts and post the journal entries

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