Richard Redden contributed $70,000 in cash and land worth $130,000 to open a new business, RR Consulting. Which of the following general journal entries will RR Consulting make to record this transaction?
A) Debit Assets $200,000; credit Redden, Capital, $200,000.
B) Debit Redden, Capital, $200,000; credit Cash $70,000, credit Land, $130,000.
C) Debit Cash $70,000; debit Land $130,000; credit Redden, Capital, $200,000.
D) Debit Redden, Capital, $200,000; credit Assets, $200,000.
E) Debit Cash and Land, $200,000; credit Redden, Capital, $200,000.

Question

Quizplus · Accepted Answer

The correct journal entry is to debit Cash for $70,000 and Land for $130,000, and credit Redden, Capital for $200,000, reflecting the total contribution to the business.

Richard Redden Contributed $70,000 in Cash and Land Worth $130,000