Question by maddie :): Accounting Journal Entry Help!!?
I am just confused on how to do these basic journal entry form situations on my homework. If you could help me out that would be great! Thanks

July 1. Tony purchases $ 17,000 of Great Adventures’ (his own company along with Suzie as co-presidents) common stock by borrowing from a local bank using his personal vehicle as collateral.

July 1. Suzi purchases a one-year insurance policy for $ 5,160 ($ 430 per month) to cover injuries to participants during outdoor clinics.

July 2. The company pays legal fees of $ 1,800 associated with incorporation.

July 7. Suzie purchases advertising of $ 230 to a local newspaper for an upcoming mountain biking clinic to be held on July 15. Attendees will be charged $ 40 the day of the clinic.

Aug 1. Suzie apples for and obtains a $ 48,000 low-interest loan for the company from the city council, which has recently passed an initiative encouraging business development related to outdoor activities. The loan is due in 3 years, and 6% annual interest is due each year on July 31.

If you can answer any of these that would help greatly! If you could also explain how you got your answer that would help me out to so I can do it by myself. Thanks!

Best answer:

Answer by JKRB
There’s not much to explain, they’re all pretty straightforward.

July 1. Tony purchases $ 17,000 of Great Adventures’ (his own company along with Suzie as co-presidents) common stock by borrowing from a local bank using his personal vehicle as collateral.
Dr Cash 17,000
Cr Common Stock 17,000
July 1. Suzi purchases a one-year insurance policy for $ 5,160 ($ 430 per month) to cover injuries to participants during outdoor clinics.
Dr Prepaid Insurance 5,160
Cr Cash 5,160
July 2. The company pays legal fees of $ 1,800 associated with incorporation.
Dr Legal Fees 1,800
Cr Cash 1,800
July 7. Suzie purchases advertising of $ 230 to a local newspaper for an upcoming mountain biking clinic to be held on July 15. Attendees will be charged $ 40 the day of the clinic.
Dr Advertising Expense 230
Cr Cash 230
Aug 1. Suzie apples for and obtains a $ 48,000 low-interest loan for the company from the city council, which has recently passed an initiative encouraging business development related to outdoor activities. The loan is due in 3 years, and 6% annual interest is due each year on July 31.
Dr Cash 48,000
Cr Notes Payable 48,000

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