Question Content Area

Continuing Problem

Chapter $1-$ Instruction #$1$

Peyton Smith enjoys listening to all types of music and owns countless CDs$.$ Over the years, Peyton has gained a local reputation for knowledge of music from classical to rap and the ability to put together sets of recordings that appeal to all ages.

During the last several months, Peyton served as a guest disc jockey on a local radio station. In addition, Peyton has entertained at several friends$$ parties as the host deejay.

On June $1,20$Y$5,$ Peyton established a corporation known as PS Music. Using an extensive collection of music MP$3$ files, Peyton will serve as a disc jockey on a fee basis for weddings, college parties, and other events. During June, Peyton entered into the following transactions:

Date Transaction

June $1.$ Deposited $$4,000$ in a checking account in the name of PS Music in exchange for common stock.

June $2.$ Received $$3,500$ from a local radio station for serving as the guest disc jockey for June.

June $2.$ Agreed to share office space with a local real estate agency, Pinnacle Realty. PS Music will pay one$-$fourth of the rent. In addition, PS Music agreed to pay a portion of the wages of the receptionist and to pay one$-$fourth of the utilities. Paid $$800$ for the rent of the office.

June $4.$ Purchased supplies from City Office Supply Co$.$ for $$350.$ Agreed to pay $$100$ within $10$ days and the remainder by July $5,20$Y$5.$

June $6.$ Paid $$500$ to a local radio station to advertise the services of PS Music twice daily for two weeks.

June $8.$ Paid $$675$ to a local electronics store for renting digital recording equipment.

June $12.$ Paid $$350($music expense$)$ to Cool Music for the use of its current music demos to make various music sets.

June $13.$ Paid City Office Supply Co$.$ $$100$ on account.

June $16.$ Received $$300$ from a dentist for providing two music sets for the dentist to play for her patients.

June $22.$ Served as disc jockey for a wedding party. The father of the bride agreed to pay $$1,000$ in July.

June $25.$ Received $$500$ for serving as the disc jockey for a cancer charity ball hosted by the local hospital.

June $29.$ Paid $$240($music expense$)$ to Galaxy Music for the use of its library of music demos.

June $30.$ Received $$900$ for serving as PS disc jockey for a local club$$s monthly dance.

June $30.$ Paid Pinnacle Realty $$400$ for PS Music$$s share of the receptionist$$s wages for June.

June $30.$ Paid Pinnacle Realty $$300$ for PS Music$$s share of the utilities for June.

June $30.$ Determined that the cost of supplies on hand is $$170.$ Therefore, the cost of supplies used during the month was $$180.$

June $30.$ Paid for miscellaneous expenses, $$415.$

June $30.$ Paid $$1,000$ royalties $($music expense$)$ to National Music Clearing for use of various artists$$ music during the month.

June $30.$ Paid dividends, $$500.$

Required:

Indicate the effect of each transaction and the balances after each transaction. Enter deductions and negative values $($withdrawals and expenses$)$ as negative numbers. For transactions occurring on the same date, enter in the order shown above.

Assets $=$ Liabilities $+$ Stockholders' Equity

Transaction

Cash

$+$

Accounts

Receivable

$+$

Supplies

$=$

Accounts

Payable

$+$ Common

Smith,

Stock

$-$ Dividends

$+$

Fees

Earned

$-$

Music

Expense

$-$ Office

Rent

Expense

$-$ Equipment

Rent

Expense

$-$

Advertising

Expense

$-$

Wages

Expense

$-$

Utilities

Expense

$-$

Supplies

Expense

$-$

Miscellaneous

Expense

June $1$ fill in the blank $1$

$4,000$

fill in the blank $2$

$4,000$

June $2$ fill in the blank $3$

$3,500$

fill in the blank $4$

$3,500$

Bal. fill in the blank $5$

$7,500$

fill in the blank $6$

$4,000$

fill in the blank $7$

$3,500$

June $2$ fill in the blank $8$

$800$

fill in the blank $9$

$800$

Bal. fill in the blank $10$

$8,300$

fill in the blank $11$

$4,000$

fill in the blank $12$

$3,500$

fill in the blank $13$

$800$

June $4$ fill in the blank $14$

$350$

fill in the blank $15$

$100$

Bal. fill in the blank $16$

$7,500$

fill in the blank $17$

$350$

fill in the blank $18$

$100$

fill in the blank $19$

$4,000$

fill in the blank $20$

$3,500$

fill in the blank $21$

$800$

June $6$ fill in the blank $22$

$500$

fill in the blank $23$

$500$

Bal. fill in the blank $24$

$8,000$

fill in the blank $25$

$350$

fill in the blank $26$

fill in the blank $27$

fill in the blank $28$

fill in the blank $29$

fill in the