Accounting Journal Entry Examples 01

* Cash payment transactions

1. Purchase of assets in cash

2. Repayment of liabilities in cash

3. Payment of expenses in cash

* Cash receipt transactions

4. Sale of assets in cash

5. Borrowing money

6. Issuance of stock

* Cash payment transactions

1. Purchase of assets in cash

1a. Purchased merchandise and paid $2,000 in cash

1b. Purchased an equipment and paid $15,000 in cash

2. Repayment of liabilities in cash

2a. Repaid $7,000 of bank loans

2b. Paid $3,000 accounts payable

3. Payment of expenses in cash

3a. Paid $3,500 rent expense

3b. Paid $6,000 salaries expense

* Cash receipt transactions

4. Sale of assets in cash

4a. Sold merchandise and received $6,500 in cash

The cost of merchandise sold was 5,100

4b. Sold an equipment and received $8,600 in cash

The book value of the equipment was $8,000

5. Borrowing money

5a. Borrowed $9,000 in cash

5b. Issued a promissory note and received $11,000 in cash

6. Issuance of stock

6a. Issued 500 shares of common stock, at $50 per share

6b. Issued 200 shares of preferred stock, at $80 per share

Cash payment transactions

1. Purchase of assets in cash

1a. Purchased merchandise and paid $2,000 in cash

debit
credit

merchandise

2,000

cash

2,000

debit: increase in assets (merchandise)

credit: decrease in assets (cash)

1b. Purchased an equipment and paid $15,000 in cash

debit

credit
equipment

15,000

cash

15,000

debit: increase in assets (equipment)

credit: decrease in assets (cash)

2. Repayment of liabilities in cash

2a. Repaid $7,000 of bank loans

debit

credit
borrowings

7,000

cash

7,000

debit: decrease in liabilities (borrowings)

credit: decrease in assets (cash)

2b. Paid $3,000 accounts payable

debit

credit

accounts payable
3,000

cash

3,000

debit: decrease in liabilities (accounts payable)

credit: decrease in assets (cash)

3. Payment of expenses in cash

3a. Paid $3,500 rent expense

debit

credit

rent expense
3,500

cash

3,500

debit: increase in expenses (rent expense)

credit: decrease in assets (cash)

3b. Paid $6,000 salaries expense

debit

credit

salaries expense

6,000
 cash

6,000

debit: increase in expenses (salaries expense)

credit: decrease in assets (cash)

Cash receipt transactions

4. Sale of assets in cash

4a. Sold merchandise and received $6,500 in cash

debit

credit
cash

6,500

sales

6,500

debit: increase in assets (cash)

credit: increase in revenue (sales)

The cost of merchandise sold was 5,100

debit

credit

cost of goods sold

5,100

merchandise

5,100

debit: increase in assets (cash)

credit: increase in revenue (sales)

4b. Sold an equipment and received $8,600 in cash

The book value of the equipment was $8,000

debit

credit

cash
8,600

equipment

8,000

gain on sale of equipment

600

debit: increase in assets (cash)

credit: increase in revenue (sales)

5. Borrowing money

5a. Borrowed $9,000 in cash

debit

credit

cash

9,000

borrowings

9,000

debit: increase in assets (cash)

credit: increase in liabilities (borrowings)

5b. Issued a promissory note and received $11,000 in cash

debit
credit

cash

11,000

notes payable

11,000

debit: increase in assets (cash)

credit: increase in liabilities (notes payable)

6. Issuance of stock

6a. Issued 500 shares of common stock, at $50 per share

debit
credit

cash

25,000

Common stock

25,000

debit: increase in assets (cash)

credit: increase in equity (common stock)

6b. Issued 200 shares of preferred stock, at $80 per share

debit

credit
cash

16,000

Preferred stock

16,000

debit: increase in assets (cash)

credit: increase in equity (preferred stock)

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Accounting Journal Entries

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