Transaction Analysis and Trial Balance

James Behm, electrical contractor, began business on May 1. The following transactions occurred during the month of May:

May	1	Behm invested $15,500 of his personal funds in the business in exchange for common stock.
	2	Purchased equipment on account, $4,200.
	3	Returned $1,200 of equipment that was not satisfactory. The return reduced the amount owed to the supplier.
	4	Purchased supplies on account, $860.
	5	Purchased a truck for $9,500. Behm paid $7,000 cash and gave a note payable for the balance.
	6	Paid rent for May, $875.
	7	Paid fuel cost for truck, $90.
	8	Billed customers for services rendered, $13,700.
	9	Paid $3,000 on account for the equipment purchased on May 2.
	10	Paid utilities for May, $210.
	11	Received invoice for May advertising, to be paid in June, $350.
	12	Paid employee wages, $3,350.
	13	Collected $8,600 on accounts receivable.
	14	Paid stockholders $1,500 cash as a dividend.
	15	Paid interest for May on an outstanding note payable, $30.

Required

a. Prepare journal entries and record the above transactions in T-accounts, and key entries with the numbers of the transactions. The following accounts will be needed to record the transactions for May: Cash; Accounts Receivable; Supplies; Equipment; Truck; Accounts Payable; Notes Payable; Common Stock; Dividends; Service Revenue; Rent Expense; Wages Expense; Utilities Expense; Truck Expense; Advertising Expense; and Interest Expense.

General Journal
Date	Description	Debit	Credit
(1)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record issuance of common stock.
(2)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record purchase of equipment on account.
(3)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record return of equipment on account.
(4)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record supplies purchased on account.
(5)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	Cash	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record purchase of truck.
(6)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record payment for rent.
(7)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record fuel expense for truck.
(8)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record billings for service revenue.
(9)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record payment of equipment purchased.
(10)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record payment of utilities expense.
(11)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record invoice for advertising.
(12)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record payment of salaries.
(13)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record cash collected form customers.
(14)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record payment of dividends.
(15)	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseCashCommon StockDividendsEquipmentInterest ExpenseNotes PayableRent ExpenseService RevenueSuppliesTruckTruck ExpenseUtilities ExpenseWages Expense	Answer	Answer
	To record payment of interest expense.

Cash
(1)	Answer	Answer
(5)	Answer	Answer
(6)	Answer	Answer
(7)	Answer	Answer
(9)	Answer	Answer
(10)	Answer	Answer
(12)	Answer	Answer
(13)	Answer	Answer
(14)	Answer	Answer
(15)	Answer	Answer
Bal	Answer	Answer

Accounts Receivable
(8)	Answer	Answer
(13)	Answer	Answer
Bal	Answer	Answer

Truck
(5)	Answer	Answer
Bal	Answer	Answer

Notes Payable
(5)	Answer	Answer
Bal	Answer	Answer

Accounts Payable
(2)	Answer	Answer
(3)	Answer	Answer
(4)	Answer	Answer
(9)	Answer	Answer
(11)	Answer	Answer
Bal	Answer	Answer

Common Stock
(1)	Answer	Answer
Bal	Answer	Answer

Interest Expense
(15)	Answer	Answer
Bal	Answer	Answer

Service Revenue
(8)	Answer	Answer
Bal	Answer	Answer

Rent Expense
(6)	Answer	Answer
Bal	Answer	Answer

Wage Expense
(12)	Answer	Answer
Bal	Answer	Answer

Truck Expense
(7)	Answer	Answer
Bal	Answer	Answer

Advertising Expense
(11)	Answer	Answer
Bal	Answer	Answer

Utilities Expense
(10)	Answer	Answer
Bal	Answer	Answer

Supplies
(4)	Answer	Answer
Bal	Answer	Answer

Dividends
(14)	Answer	Answer
Bal	Answer	Answer

Equipment
(2)	Answer	Answer
(3)	Answer	Answer
Bal	Answer	Answer

b. Prepare a trial balance as of May 31.

JAMES BEHM, ELECTRICAL CONTRACTOR Trial Balance May 31
		Debit		Credit
Cash		$Answer		$Answer
Accounts Receivable		Answer		Answer
Supplies		Answer		Answer
Equipment		Answer		Answer
Truck		Answer		Answer
Accounts Payable		Answer		Answer
Notes Payable		Answer		Answer
Common Stock		Answer		Answer
Dividends		Answer		Answer
Service Revenue		Answer		Answer
Rent Expense		Answer		Answer
Utilities Expense		Answer		Answer
Truck Expense		Answer		Answer
Advertising Expense		Answer		Answer
Interest Expense		Answer		Answer
Wages Expense		Answer		Answer
Totals		$Answer		$Answer