Summary of Journal Entries for Typical TransactionsChapter 2 & 3In Chapter 21. Buying assetsTwo scenarios:a. Buying with cashJournal entry:Dr: Assets (A +)Cr: Cash (A-)b. Buying on creditJournal entry:Dr: Assets (A+)Cr: Accounts payable/Notes payable (L+)Subsequent journal entry for paying cash:Dr: Accounts payable/Notes payable (L-)Cr: Cash (A-)2. Borrowing debtJournal entry:Dr: Cash (A+)Cr: Notes payable/Mortgage payable (L+)3. Receiving investments from ownersJournal entry:Dr: Cash or other assets (A+)Cr: Contributed capital (SE+)In Chapter 34. Selling goods or delivering serviceTwo scenarios:a. Selling with cashJournal entry:Dr: Cash (A +)Cr: Revenue (R+/SE+)b. Selling on creditJournal entry:Dr: Accounts receivable (A+)Cr: Revenue (R+/SE+)Subsequent journal entry for receiving cash payment:Dr: Cash (A+)Cr: Accounts receivable (A-)5. Using up assets or service – Expense incursTwo scenarios:a. Paying cash for using up serviceJournal entry:Dr: Expense (E +/SE-)Cr: Cash (A-)b. Using up service first, then paying cashJournal entry for upon using up service:Dr: Expense (E+/SE-)Cr: Payable (L+)Subsequent journal entry for PAYING cash:Dr: Payable (L-)Cr: Cash (A-)6. Declaring dividendsTwo scenarios:a. Declaring and paying dividends at the same timeJournal entry:Dr: Dividends declared (SE-)Cr: Cash (A-)b. Declaring dividends first, then paying cash Journal entry for upon dividend declaration:Dr: Dividends declared (SE-)Cr: Dividend Payable (L+)Subsequent journal entry for PAYING cash:Dr: Dividend Payable (L-)Cr: Cash
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