Four transactions for Automotive Maintenance and Repair Shop that took place in November 2019 appear below. DATE TRANSACTION Nov. 1 Ryan O’Malley invested $63,000 in cash plus tools with a fair market value of $2,800 to start the business. 2 Purchased equipment for $1,870 and supplies for $370 from Office Depot, Invoice 501; issued Check 100 for $520 as a down payment with the balance due in 30 days. 10 Performed services for Patricia Reed for $3,700, who paid $1,400 in cash with the balance due in 30 days. 20 Purchased machinery for $4,800 from Craft Machinery, Inc., Invoice 709; issued Check 101 for $1,900 in cash as a down payment with the balance due in 30 days. Record the transactions in the general journal and post them to the appropriate ledger accounts. Analyze: What liabilities does the business owe as of November 30?

As of Nov 30 the business has a credit balance of Accounts Payable of

$ 4620.  

Explanation:

S. No:  DATE                       TRANSACTION                DEBIT         CREDIT

1   -   Nov. 1                      Cash                                $ 63,000

                                                                Tools                      $ 2800

                                                  Capital                              $ 65,800

Ryan O’Malley invested $63,000 in cash plus tools with a fair market value of $2,800 to start the business.

2-    Nov 2                               Equipment                $1870

                                  Supplies                    $370

                                                      Bank                                   $520

                                                 Accounts Payable                   $ 1720

Purchased equipment for $1,870 and supplies for $370 from Office Depot, Invoice 501; issued Check 100 for $520 as a down payment with the balance due in 30 days.

3-- Nov 10                             Cash                          $1400

                                    Accounts Receivable $23,00

                                                  Services                             $3700                    

Performed services for Patricia Reed for $3,700, who paid $1,400 in cash with the balance due in 30 days.

4-- Nov   20                                 Machinery             $ 4800

                                        Cash (Bank)                                              $1900

                                         Accounts Payable                                   $2900

Purchased machinery for $4,800 from Craft Machinery, Inc., Invoice 709; issued Check 101 for $1,900 in cash as a down payment with the balance due in 30 days.

                          2- $ 520

                             4- $ 1900                                  

                       Bal      $ 2420                          

 1-  $63,000                                               3-   $ 2300

3-      $ 1400        4- $1900                                                                                

Bal  62,500                                                Bal  $2300                                    

2- $1870

                                                                     2-   $ 370

Bal  $ 1870                                                Bal  $370                                    

4- $ 4800                                                                              

                                                                                                 2- $1720

                                                                                                  4- $ 2900            

Bal  $ 4800                                                                           Bal $ 4620      

lives by a moral and ethical code