Group 4Group 4Problem P3-1Problem P3-1

Tony PhanTony PhanLiliana DoonanLiliana Doonan

Julee Maidenberg Julee Maidenberg Erik Peterson Erik Peterson

Shawn CrollShawn Croll

Choudhury CorporationChoudhury Corporation

B.B. Issued stock to new investors.Issued stock to new investors.

DebitDebit: Cash : Cash CreditCredit: Contributed Capital: Contributed Capital

A.A. Example: Purchased equipment for use Example: Purchased equipment for use in the business; paid one-third cash and in the business; paid one-third cash and signed a note payable for the balancesigned a note payable for the balance

DebitDebit: Equipment : Equipment CreditCredit: Cash, Note : Cash, Note payablepayable

C.C. Paid cash for salaries and wages.Paid cash for salaries and wages.

DebitDebit: Operating expenses : Operating expenses CreditCredit: Cash: Cash

E.E. Collected cash on accounts receivable Collected cash on accounts receivable for services performed last period.for services performed last period.DebitDebit: Cash: CashCreditCredit: Accounts receivable: Accounts receivable

D.D. Collected cash for services performed Collected cash for services performed this period.this period.

DebitDebit: Cash : Cash CreditCredit: Service revenue: Service revenue

F.F. Performed services this period on credit.Performed services this period on credit.

DebitDebit: Accounts receivable : Accounts receivable

CreditCredit: Service revenue: Service revenue

H.H. Paid cash on accounts payable for Paid cash on accounts payable for expenses incurred last period.expenses incurred last period.

DebitDebit: Accounts payable : Accounts payable CreditCredit: cash: cash

G.G. Paid operating expenses incurred this Paid operating expenses incurred this period.period.

DebitDebit: Operating expenses: Operating expenses

CreditCredit: cash: cash

I.I. Incurred operating expenses this period Incurred operating expenses this period to be paid next period.to be paid next period.

DebitDebit: Operating expenses: Operating expenses

CreditCredit: Accounts payable: Accounts payable

K.K. Used some of the supplies on hand for Used some of the supplies on hand for operation.operation.DebitDebit: Operating expenses : Operating expenses CreditCredit: Supplies on Hand: Supplies on Hand

J.J. Purchased supplies to be used later; Purchased supplies to be used later; paid cashpaid cash

DebitDebit: Supplies on Hand : Supplies on Hand CreditCredit: Cash: Cash

L.L. Purchased a patent (an intangible asset); Purchased a patent (an intangible asset); paid cash.paid cash.

DebitDebit: Patents : Patents CreditCredit: Cash: Cash

N.N. Paid three-fourths of the income tax expense Paid three-fourths of the income tax expense for the year. The balance will be paid next year.for the year. The balance will be paid next year.DebitDebit: Income tax expense : Income tax expense CreditCredit: income : income taxes payable, cashtaxes payable, cash

M.M. Made a payment on the equipment note Made a payment on the equipment note in (a); the payment was part principal in (a); the payment was part principal and part interest expense.and part interest expense.

DebitDebit: Note payable, interest expense : Note payable, interest expense CreditCredit: cash: cash

O.O. On the last day of the current period, On the last day of the current period, paid cash for an insurance policy paid cash for an insurance policy covering the next two years.covering the next two years.

DebitDebit: Prepaid expenses : Prepaid expenses CreditCredit: Cash: Cash