Asked by Chantell Richmeier on Mar 10, 2024
Verified
During the month of June, Jane invested $19,000 in starting her legal practice. The proper journal entry would be:
A) Cash, debit $19,000; Jane, Capital, credit $19,000
B) Accounts Payable, debit $19,000; Cash, credit $19,000
C) Cash, debit $19,000; Revenue, credit $19,000
D) Jane's Capital, debit $19,000; Cash, credit $19,000
Jane's Capital
Jane's Capital refers to the amount of money or value of assets that Jane has invested in a business or enterprise.
Legal Practice
The profession and activities related to providing legal advice, representation, and services to clients.
Journal Entry
A record in accounting that notes a specific financial transaction in a company's general ledger.
- Master the skill to identify and prepare basic journal entries for distinct commercial activities.
- Become familiar with the repercussions of transactions on the owner’s equity and the formulation of the statement of owner's equity.
Verified Answer
KA
khalid albarwaniMar 10, 2024
Final Answer :
A
Explanation :
When Jane invests $19,000 in her legal practice, it increases her business's cash (an asset), which is debited, and simultaneously increases her capital account (owner's equity), which is credited. This reflects the inflow of capital into the business.
Learning Objectives
- Master the skill to identify and prepare basic journal entries for distinct commercial activities.
- Become familiar with the repercussions of transactions on the owner’s equity and the formulation of the statement of owner's equity.