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Ed runs an auto repair business out of the garage attached to his personal residence. How should he account for each of the following items?

a. Cash received from repair services, $28,000.

b. Interest paid on his home mortgage, $7,300.

c. Power jack hoist purchased at a cost of $12,000.

d. Electricity bills, $3,600. (Ed does not have separate electricity service to the garage.)

e. Checks received from customers that were returned by his bank, $1,600. The bank charged Ed's account $35 for processing the bad checks.

f. Telephone bill for phone in the garage, $420. (Ed has a separately listed phone in his house.)

g. Advertising in the local newspaper, $800.

h. Interest paid on home furniture loan, $600.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91647660

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