Selected transactions for Loving Home, an interior decorator corporation, in its first month of business, are as follows.

1. Issued stock to investors for $18,319 in cash.

2. Purchased used car for $9,902 cash for use in business.

3. Purchased supplies on account for $367.

4. Billed customers $5,017 for services performed.

5. Paid $254 cash for advertising start of the business.

6. Received $1,280 cash from customers billed in transaction (4).

7. Paid creditor $380 cash on account.

8. Paid dividends of $488 cash to stockholders.


a. For each transaction indicate (a) the basic type of account debited and credited (asset, liability, stockholders’ equity); (b) the specific account debited and credited (Cash, Rent Expense, Service Revenue, etc.); (c) whether the specific account is increased or decreased; and (d) the normal balance of the specific account. Use the folllowing format, in which transaction1 is given as an example.

b. Journalize the transactions. Do not provide explanations.