Following are the transactions of Dennen, Inc., for the month of Janu a. Borrowe

Question

Following are the transactions of Dennen, Inc., for the month of Janu a. Borrowed $30,000 from a local bank. b Lent $10,000 to an afillate; accepted a note due in one year 100 additional shares of stock with a par value of $0.10 per share and a market price of $5 per share, reg s1soitherest oue in ore year celved cash d. Purchased $15,000 of equipment, paying $5,000 cash e. Deciared and paid $2,000 in dividends to stockholders. Prepare the journal entry to record each of the above transactions for the month of January. If no entry is required for a transaction'event, select "No journal entry required" in the first account field) Journal entry worksheet Record the receipt of the bank loan of $30,000 NoeEnter delbits before credsts Debit Record entry Clear entry View general ¡ournal

Explanation / Answer

Transactions

Account Titles & Explanation

Debit

Credit

a.

Cash

$30000

     Notes Payable

$30000

(To record borrowed money from bank)

b.

Notes Receivable

$10000

     Cash

$10000

(To record money lent to the affiliate)

c.

Cash (100 * $5)

$500

     Common stock (100 * $0.10)

$10

     Additional paid in capital (100 * $4.90)

$490

(To record issue of common stock)

d.

Equipment

$15000

      Cash

$5000

      Notes Payable

$10000

e.

Retained Earnings

$2000

     Dividend payable

$2000

(To record declaration of dividend)

Dividend payable

$2000

     Cash

$2000

(To record payment of dividend)

OR

One combined entry can be made in spite of above two journal entry for dividend.

Retained Earnings

$2000

     Cash

$2000

(To record declaration and payment of dividend)

Transactions

Account Titles & Explanation

Debit

Credit

a.

Cash

$30000

     Notes Payable

$30000

(To record borrowed money from bank)

b.

Notes Receivable

$10000

     Cash

$10000

(To record money lent to the affiliate)

c.

Cash (100 * $5)

$500

     Common stock (100 * $0.10)

$10

     Additional paid in capital (100 * $4.90)

$490

(To record issue of common stock)

d.

Equipment

$15000

      Cash

$5000

      Notes Payable

$10000

e.

Retained Earnings

$2000

     Dividend payable

$2000

(To record declaration of dividend)

Dividend payable

$2000

     Cash

$2000

(To record payment of dividend)

OR

One combined entry can be made in spite of above two journal entry for dividend.

Retained Earnings

$2000

     Cash

$2000

(To record declaration and payment of dividend)

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