BE3-1 Transactions for Mehta Company for the month of May are presented below. Prepare journal entries Tor each of these transactions. (You may omit explanations.) May 1 B.D. Mehta invests $4,000 cash in exchange for common stock in a small welding corporation. Buys equipment on account for $1,100. Pays $400 to landlord for May rent Bills Noble Corp. $500 for welding work done. 3 13 21 4 BE3-2 Agazzi Repair Shop had the following transactions during the first month of business as a propri- etorship. Journalize the transactions. (Omit explanations.) Aug. 2 Invested $12,000 cash and $2,500 of equipment in the business. Purchased supplies on account for $500. (Debit asset account.) 7 Performed services for clients, for which $1,300 was collected in cash and $670 was billed to the clients. Paid August rent $600. Counted supplies and determined that only $270 of the supplies purchased on August 7 are still on hand. 12 15 19 4 5 BE3-3 On July 1, 2014, Crowe Co. pays $15,000 to Zubin Insurance Co. for a 3-year insurance policy. Both companies have fiscal years ending December 31. For Crowe Co., journalize the entry on July 1 and the adjusting entry on December 31 45 BE3-4 Using the data in BE3-3, journalize the entry on July 1 and the adjusting entry on December 31 for Zubin Insurance Co. Zubin uses the accounts Unearned Service Revenue and Service Revenue. 4 5 BE3-5 Assume that on February 1, Procter & Gamble (P&G) paid $720,000 in advance for 2 years insur- ance coverage. Prepare P&G's February 1 journal entry and the annual adjusting entry on June 30. 45 BE3-6 LaBouche Corporation owns a warehouse. On November 1, it rented storage space to a lessee (tenant) for 3 months for a total cash payment of $2,400 received in advance. Prepare LaBouche's Novem- ber 1 journal entry and the December 31 annual adjusting entry 45 BE3-7 Dresser Company's weekly payroll, paid on Fridays, totals $8,000. Employees work a 5-day week Prepare Dresser's adjusting entry on Wednesday, December 31, and the journal entry to record the $8,000 cash payment on Friday, January 2 5 BE3-8 Included in Gonzalez Company's December 31 trial balance is a note receivable of $12,000. The note is a 4-month, 10% note dated October 1. Prepare Gonzalez's December 31 adjusting entry to record $300 of accrued interest, and the February 1 journal entry to record receipt of $12,400 from the borrower 134 Chapter 3 The Accounting Information System 5 BE3-9 Prepare the following adjusting entries at August 31 for Walgreens (a) Interest on notes payable of $300 is accrued. (b) Services performed but unbilled total $1,400 (c) Salaries and wages eamed by employees of $700 have not been recorded. (d) Bad debt expense for year is S900. Use the following account titles: Service Revenue, Accounts Receivable, Interest Expense, Interest Payable, Salaries and Wages Expense, Salaries and Wages Payable, Allowance for Doubtful Accounts, and Bad Debt Expense