Question 10 Patrida Morrow operates Crane Riding Academy, Inc. The academy's primary sources of revenue are riding fees and lesson fees, which are provided on a cash basis. Patricia also boards horse 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 these accounts: Cash, Accoun Receivable, Uneamed Service Revenue, and Service Revenue. The academy owns 10 horses, a stable, a riding corral, riding equipment, and office equipment. These assets are accounted for in the following accounts: Horses, Buildings, and Equipment. The academy employs stable helpers and an office employee, who receive weekly salaries. At the end of each month, the mall usually brings bills for advertising, utilities, and veterinary service Other expenses include feed for the horses and Insurance. For its expenses, the academy maintains the following accounts: Supplies, Prepaid Insurance, Accounts Payable, Salaries and Wages Expense, Advertising Expense, Utilities Expense, Maintenance and Repairs Expense, Supplies Expense, and Insurance Expense. Patricia's sole source of personal income is dividends from the academy. Thus, the corporation declares and pays periodic dividends. To account for stockholders' equity in the business and divi two accounts are maintained: Common Stock and Dividends. During the first month of operations, an inexperienced bookkeeper was employed. Patricia asks you to review the following eight entries of the 50 entries made during the month. In each case, explanation for the entry is correct. May 1 11,400 11,400 190 5 190 7 Cash Uneared Service Revenue (Issued common stock in exchange for $11,400 casa) Cash Service Revenue (Received $190 cash for lesson fees) Cash Service Revenue (Received $360 for boarding of horses beginning June 1) Supplies Expense Cash (Purchased estimated 5 months supply of feed and hay for $1,140 on account) Frum 380 380 9 1,140 1,140 An Sans Inc at During the first month of operations, an inexperienced bookkeeper was employed. Patricia asks you to review the fol explanation for the entry is correct. May 1 11,400 11,400 190 5 190 7 380 380 9 1,140 1,140 Cash Uneared Service Revenue (Issued common stock in exchange for $11,400 cash) Cash Service Revenue (Received $190 cash for lesson fees) Cash Service Revenue (Received $380 for boarding of horses beginning June 1) Supplies Expense Cash (Purchased estimated 5 months' supply of feed and hay for $1,140 on account) Equipment Cash (Purchased desk and other office equipment for $600 cash) Salaries and Wages Expense Cash (Issued check to Patricia Morrow for personal use) Cash Service Revenue (Received $117 cash for riding fees) Maintenance and Repairs Expense 14 60 600 15 300 300 20 108 117 31 55 Accounts Receivable 55 380 9 1,140 1,140 14 60 600 15 Service Revenue (Received $380 for boarding of horses beginning June 1) Supplies Expense Cash (Purchased estimated 5 months' supply of feed and hay for $1,140 on account) Equipment Cash (Purchased desk and other office equipment for $600 cash) Salaries and Wages Expense Cash (Issued check to Patricia Morrow for personal use) Cash Service Revenue (Received $117 cash for riding fees) Maintenance and Repairs Expense Accounts Receivable (Received bill of $55 from carpenter for repair services performed) 300 300 20 108 117 31 55 55 Answer the following. (al) For each journal entry that is correct, so state
