On May 22, 2014, Hillcrest Co. purchased $6,180 of supplies on account. In Hillcrest Co.’s chart of accounts

On May 22, 2014, Hillcrest Co. purchased $6,180 of supplies on account. In Hillcrest Co.’s chart of accounts, the supplies account is No. 15, and the accounts payable account is No. 21.

a. Journalize the May 22, 2014, transaction on page 19 of Hillcrest Co.’s two-column journal. Include an explanation of the entry.
b. Prepare a four-column account for Supplies. Enter a debit balance of $1,500 as of  May 1, 2014. Place a check mark () in the Posting Reference column.
c. Prepare a four-column account for Accounts Payable. Enter a credit balance of $16,750 as of May 1, 2014. Place a check mark () in the Posting Reference column.
d. Post the May 22, 2014, transaction to the accounts.
e. Do the rules of debit and credit apply to all companies?

Answer:

a.    
JOURNAL    
Page 19    
Date   
Description 
Post. Ref.   
Debit   
Credit 
2014  Adjusting Entries    May 22 Supplies 15 6,180    Accounts Payable 21  6,180   Purchased supplies on account.     b., c., d.  Account: Supplies Account No. 15    
Date   
Item 
Post. Ref.   
Debit   
Credit 
Balance Debit Credit 2014        May 1 Balance √   1,500   22  19 6,180  7,680   Account: Accounts Payable Account No. 21    
Date   
Item 
Post. Ref.   
Debit   
Credit 
Balance Debit Credit 2014        May 1 Balance √    16,750  22  19  6,180  22,930  e.  Yes, the rules of debit and credit apply to all companies.