Use below information to prepare general journal entries for Belle Co.'s 1 through 7 transactions. 1. D. Belle created a new business and invested $6,000 cash, $7,600 of equipment, and $12,000 in web servers in exchange for common stock.
2. The company paid $4,800 cash in advance for prepaid insurance coverage.
3. The company purchased $900 of supplies on account.
4. The company paid $800 cash for selling expenses.
5. The company received $4,500 cash for services provided.
6. The company paid $900 cash toward accounts payable.
7. The company paid $3,400 cash for equipment.

Belle Co.

General Journal Entries

1. Debit Cash $6,000

Debit Equipment $7,600

Debit Web Servers $12,000

Credit Common Stock $25,600

To record the assets exchanged for common stock by D. Belle.

2. Debit Prepaid Insurance $4,800

Credit Cash $4,800

To record the prepayment of insurance coverage.

3. Debit Supplies $900

Credit Accounts Payable $900

To record the purchase of supplies on account.

4. Debit Selling Expenses $800

Credit Cash $800

To record the payment of selling expenses for cash.

5. Debit Cash $4,500

Credit Service Revenue $4,500

To record the receipt of cash for services rendered.

6. Debit Accounts Payable $900

Credit Cash $900

To record the payment on account.

7. Debit Equipment $3,400

Credit Cash $3,400

To record the payment for the purchase of equipment.

Explanation:

a) Data and Transaction Analysis:

1. Cash $6,000 Equipment $7,600 Web Servers $12,000 Common Stock $25,600

2. Prepaid Insurance $4,800 Cash $4,800

3. Supplies $900 Accounts Payable $900

4. Selling Expenses $800 Cash $800

5. Cash $4,500 Service Revenue $4,500

6. Accounts Payable $900 Cash $900

7. Equipment $3,400 Cash $3,400