Practice Exercises

Try to write the journal entry. Click to reveal the solution. No standards text—pure practice.

• Paid monthly rent 1,000 in cash

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• Received 700 cash from customer for services performed

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• Billed a client 900 for services

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• Recorded depreciation on equipment 150 (straight-line)

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• Purchased supplies on account 400

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• Paid salaries 800 in cash

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• Collected 600 from a customer on account

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• Paid 400 to a supplier on account

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• Owner invested 5,000 cash into the business

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• Declared and paid dividends 300

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• Received utility bill 200 to be paid next month

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• Received 1,200 cash for 3-month service contract (initial entry)

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• Recognized 1 month of the above contract revenue (400)

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• Wrote off an uncollectible account 150 (direct write-off)

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• Sold merchandise for 1,000 cash; cost 600 (two entries)

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• Sold merchandise for 1,000 cash; cost 600 (two entries)

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• Customer paid half of the bundle invoice in cash, 1,000

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• Recorded year-end bonus accrual for sales staff, 1,250

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• Delivered goods related to deposit (recognize revenue), 1,000; cost 650

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• Paid cash for insurance (1-year policy), 1,800

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• Monthly insurance expense recognition, 150

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• Obtained short-term bank loan, 10,000

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• Accrued one month interest on note payable at 9%, 10,000×9%×(1/12)=75

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• Paid monthly interest on note payable in cash, 75

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• Purchased inventory with purchase returns later (initial purchase 4,000 on credit)

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• Purchase return to supplier from that lot, 500

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• Paid supplier within 1% discount period on remaining 3,500

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• Sold goods for cash during weekend fair; sales 2,200; cost 1,430

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• Recorded credit card fee on cash sales (3% of 2,200 = 66) retained by processor

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• Identified obsolete inventory scrapped, 190

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• Billed customer for services and goods bundle: services 900, goods 1,100 (cost 700)

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• Recognized one month of rent expense from prepaid, 800

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• Sold goods on credit with trade discount: list 4,000 less 10% = 3,600; cost 2,200

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• Customer returned part of discounted sale: selling 600; cost 360

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• Paid cash for advertising, 750

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• Purchased inventory; paid cash plus nonrefundable import duties 500 (total 9,500)

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• Sold goods on credit, sales 7,200; cost 4,800

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• Collected A/R in full for 7,200 sale (no discount)

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• Recognized warranty expense (estimate) 2% of sales (assume 144)

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• Performed warranty repairs in cash, 90

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• Purchased inventory; paid freight-in billed by carrier on account, 320

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• Paid the freight-in payable, 320

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• Recognized inventory write-down to NRV, 275

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• Received customer deposit for future goods (unearned), 1,000

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• Purchased inventory on credit, 8,000

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• Paid freight-in for inventory in cash, 600

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• Returned defective inventory to supplier, 1,200

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• Paid supplier within 2/10, n/30 discount period on prior 6,800 balance

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• Sold goods on credit, selling price 5,000; cost 3,200

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• Customer returned part of sale: sales price 800; cost 520

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• Collected from customer within 2% discount period on remaining 4,200 A/R

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• Recorded estimate of bad debts at month-end, 2% of credit sales (assume 100)

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• Wrote off a specific uncollectible account, 300

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• Recovered previously written-off account and collected cash, 300

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• Recorded inventory shrinkage on count, 450

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• Purchased inventory for cash, 2,400

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• Paid freight-out (delivery expense) in cash for customer shipments, 150

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• Granted sales allowance to customer, 120

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• Sold goods for cash; sales price 3,600; cost 2,250

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• Accepted a 60-day, 12% note from customer to settle A/R, 2,000

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• Accrued interest on note receivable at month-end, 2,000×12%×(30/360)=20

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• Collected note receivable at maturity with interest (principal 2,000 + interest 40)

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• Purchased inventory on credit with terms 1/10, n/30, 5,500

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• Paid supplier after discount period on 5,500 purchase

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• Granted cash discount to customer at payment (A/R 1,000, 2% discount)

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• Purchased office supplies on credit, 900

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• Used office supplies (adjustment), 300

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• Recorded prepaid rent for three months paid in cash, 2,400

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