Activity 1: Transactions I rotustia Prepare the general journal entries to record the following transactions for the business for the month of May 2016 (ignore GST): May 1 Owner deposited 50,000 of his own money into the business' bank account. 3 Employed a part-time worker to begin work on the first Monday of next month, earning a salary of 450 per week. Purchased office supplies for 80 and a laptop for 2,500 , both on credit. Bought 8,000 worth of new inventory on credit to be sold in the shop. Paid rent of 900 . Received 2,000 cash from a client for services provided. Sold inventory for 1,750 cash, and 4,150 on credit. The inventory had cost the business 4,000 10 A short-term bank loan of 10,000 was taken out to help with some equipment purchases. Owner took home 1,500 for personal use Invoiced a client for 2,100 for services provided. Paid electricity of 412 . Paid 2,000 of accounts payable Received cash for 3,000 of accounts receivable Paid 300 principle off the loan and a further 35 interest. Office supplies used this month total 38 .

1. Debit Bank, Credit Owner's Equity: 80, 8,0004. Debit Rent Expense, Credit Bank: 2,0006. Debit Bank, Debit Accounts Receivable, Credit Sales Revenue: 4,150; Debit Cost of Goods Sold, Credit Inventory: 10,0008. Debit Owner's Draw, Credit Bank: 2,10010. Debit Electricity Expense, Credit Bank: 2,00012. Debit Bank, Credit Accounts Receivable: 300, 38

1. The owner deposits 1,500, decreasing the bank account and recognizing an Owner's Draw.9. A client is invoiced for services, increasing Accounts Receivable and recognizing Service Revenue.10. Electricity is paid, decreasing the bank account and increasing the Electricity Expense.11. A portion of Accounts Payable is paid, decreasing both the bank account and Accounts Payable.12. Cash is received for Accounts Receivable, increasing the bank account and decreasing Accounts Receivable.13. A portion of the loan principle and interest is paid, decreasing the bank account and the Loan Principle, and recognizing Interest Expense.14. Office supplies used are recorded, decreasing the Office Supplies asset and increasing the Office Supplies Expense.