james evans is the president of servicepro inc a company 248506

James Evans is the president of ServicePro, Inc., a company that provides temporary employees for not-for-profit companies. ServicePro has been operating for five years; its revenues are increasing with each passing year. You have been hired to help James analyze the following transactions for the first two weeks of April:

a. Billed the local United Way office $23,500 for temporary services provided.

b. Paid $3,005 for supplies purchased and recorded on account last period.

c. Placed an advertisement in the local paper for $1,400 cash.

d. Purchased a new computer for the office costing $3,800 cash.

e. Purchased office supplies for $2,600 on account.

f. Paid employee wages of $11,900. Of this amount, $3,800 had been earned and recorded in the Wages Payable account in the prior period.

g. Issued 3,000 additional shares of capital stock for cash at $40 per share in anticipation of building a new office.

h. Received $8,000 on account from the local United Way office from the services provided in (a).

i. Billed Family & Children’s Service $14,500 for services rendered.

j. Purchased land as the site of a future office for $10,000. Paid $3,000 cash down and signed a note payable for the balance.

k. Received the April telephone bill for $1,950 to be paid next month.


For each of the transactions, prepare journal entries. Be sure to categorize each account as an asset (A), liability (L), stockholders’ equity (SE), revenue (R), or expense (E).

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