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Problem 2-1A Gary Bauer


Gary Bauer opens a computer consulting business called Technology Consultants and completes the following transactions in April.

April 1 Bauer invested $100,000 cash along with $24,000 in office equipment in the company.
2 The company prepaid $7,200 cash for twelve months’ rent for an office. (Hint: Debit Prepaid
Rent for $7,200.)

3 The company made credit purchases of office equipment for $12,000 and office supplies for
$2,400. Payment is due within 10 days.

6 The company completed services for a client and immediately received $2,000 cash.

9 The company completed an $8,000 project for a client, who must pay within 30 days.

13 The company paid $14,400 cash to settle the account payable created on April 3.

19 The company paid $6,000 cash for the premium on a 12-month insurance policy. (Hint: Debit
Prepaid Insurance for $6,000.)

22 The company received $6,400 cash as partial payment for the work completed on April 9.

25 The company completed work for another client for $2,640 on credit.

28 Bauer withdrew $6,200 cash from the company for personal use.

29 The company purchased $800 of additional office supplies on credit.

30 The company paid $700 cash for this month’s utility bill.

1. Prepare general journal entries to record these transactions (use the account titles listed in part 2).

2. Open the following ledger accounts — their account numbers are in parentheses (use the balance column format): Cash (101); Accounts Receivable (106); Office Supplies (124); Prepaid Insurance (128);

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