Category: Journal Entry Examples

Section 3. Accrual basis accounting Q14. Prepaid expenses On December 1, 20×1, Entity A rented office space for one year and prepaid the $36,000 yearly

Q13. Gross profit Entity A sold 200 units of merchandise in cash at a selling price of $50 per unit. Entity A purchased merchandise at

Q12. Cost of goods sold Entity A sold 100 units of merchandise in cash at a selling price of $17 per unit. The purchase cost

Q11. Sale of merchandise Entity A sold merchandise at the price of $26,000 on account. Prepare a journal entry to record this transaction. A11. Sale

Q10. Purchase of merchandise Entity A purchased 100 units of merchandise at $8,300 on account. Prepare a journal entry to record this transaction. A10. Purchasing

Q9. Cash payment What does a journal entry look like when cash is paid? A9. A decrease in cash is recorded on the credit side