TRANSACTION ANALYSIS AND JOURNAL ENTRIES Pasta House, Inc., was organized in January 2009. During the year, the following transactions occurred:

a. On January 14, Pasta House, Inc., sold Martin Halter, the firm’s founder and sole owner, 10,000 shares of its common stock for $7 per share.

b. On the same day, Bank One loaned Pasta House $30,000 on a 10-year note payable.

c. On February 22, Pasta House purchased a building and the land on which it stands from Frank Jakubek for $14,000 cash and a 5-year, $36,000 note payable. The land and building had appraised values of $10,000 and $40,000, respectively.

d. On March 1, Pasta House signed an $18,000 contract with Cosby Renovations to remodel the inside of the building. Pasta House paid $6,000 down and agreed to pay the remainder when Cosby completed its work.

e. On May 3, Cosby completed its work and submitted a bill to Pasta House for the remaining $12,000.

f. On May 20, Pasta House paid $12,000 to Cosby Renovations.

g. On June 4, Pasta House purchased restaurant supplies from Glidden Supply for

$950 cash.

Required:

Prepare a journal entry for each of these transactions.

Exercise