Martinez Corp. provides security services. Selected transactions for Martinez Corp. are presented below.

Oct. 1 Issued common stock in exchange for $59,400 cash from investors.

2 Hired part-time security consultant. Salary will be $1,800 per month. First day of work will be October 15.

4 Paid 1 month of rent for building for $1,800.

7 Purchased equipment for $16,200, paying $3,600 cash and the balance on account.

8 Paid $1,200 for advertising.

10 Received bill for equipment repair cost of $370.

12 Provided security services for event for $2,900 on account.

16 Purchased supplies for $370 on account.

21 Paid balance due from October 7 purchase of equipment.

24 Received and paid utility bill for $133.

27 Received payment from customer for October 12 services performed.

31 Paid employee salaries and wages of $4,600.

Required:

A) Journalize the transactions.

Answer and Explanation:

The Journal entry is shown below:-

On Oct 1

Cash Dr, $59,400

To Common stock $59,400

(Being the issuance of the common stock is recorded)

On Oct 2

No Journal entry is required

On Oct 4

Rent expenses Dr, $1,800

To Cash $1,800

(Being the rent expense is recorded

On Oct 7

Equipment Dr, $16,200

To Cash $3,600

To Accounts payable $12,600

(Being equipment is recorded)

On Oct 8

Advertisement Dr, $1,200

To Cash $1,200

(Being cash paid is recorded)

On Oct 10

Repair expenses Dr, $370

To Accounts payable $370

(Being repair expenses is recorded)

On Oct 12

Accounts receivable Dr, $2,900

To service revenue $2,900

(Being service provided is recorded)

On Oct 16

Supplies Dr, 4370

To Accounts payable $370

(Being supplies purchased on account is recorded)

On Oct 21

Accounts payable Dr, $12,600

($16,200 - $3,600)

To Cash $12,600

(Being cash paid is recorded)

On Oct 24

Utility expenses Dr, $133

To Cash $133

(Being utility expense is recorded)

On Oct 27

Cash Dr, $2,900

To Accounts receivable $2,900

(Being cash received is recorded)

On Oct 31

Salaries and wages expenses Dr, $4,600

To Cash $4,600

(Being cash paid is recorded)