Expand Your Critical Thinking 2-06 al-a2, b-d (Part Level Submission) Dyanna Craig operates Craig Riding Academy. The academy's primary sources of revenue are riding fees and lesson fees, which are paid on a cash basis. Dyanna also boards horses for owners, who are billed monthly for boarding fees. In a few cases, boarders pay in advance of expected use. For its revenue transactions, the academy maintains the following accounts: Cash, Accounts Receivable, and Service Revenue. The academy owns 10 horses, a stable, a riding corral, riding equipment, and office equipment. These assets are accounted for in these accounts: Horses, Buildings, and Equipment. The academy also maintains the following accounts: Supplies, Prepaid Insurance, Accounts Payable, Salaries and Wages Expense, Advertising Expense, Utilities Expense, and Maintenance and Repairs Expense. Dyanna pays periodic cash dividends to stockholders. To record stockholders' equity in the business and dividends, three accounts are maintained: Common Stock, Retained Earnings, and Dividends. During the first month of operations, an inexperienced bookkeeper was employed. Dyanna Craig asks you to review the following eight entries of the 50 entries made during the month. In each case, the explanation for the entry is correct. Debit Credit Date May 1 20,000 20,000 Account Titles and Explanation Cash Common Stock (Issued common stock for $20,000 cash) Cash Service Revenue (Received $260 cash for lessons provided) Cash 5 260 260 7 305 305 80 Service Revenue (Received $305 for boarding of horses beginning June 1) 14 Equipment Cash (Purchased desk and other office equipment for $800 cash) 15 Salaries and Wages Expense 800 415 Cash 415 (Issued dividend checks to stockholders) 20 Cash 148 184 Service Revenue (Received $184 cash for riding fees) Maintenance and Repairs Expense Accounts Payable 30 70 70 31 1,720 (Received bill of $70 from carpenter for repair services performed) Supplies Cash (Purchased an estimated 2 months' supply of feed and hay for $1,720 on account) 1,720 (a2) For each journal entry that is incorrect, prepare the entry that should have been made by the bookkeeper. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit