In November 2014, after having incorporated Cookie Creations Inc., Natalie begins operations. She has decided not to pursue the offer to supply cookies to Biscuits. Instead, she will focus on offering cooking classes. The following events occur.

Nov. 8 Natalie cashes in her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account.

8 Natalie opens a bank account for Cookie Creations Inc.

8 Natalie purchases $500 of Cookie Creations’ common stock.

11 Cookie Creations purchases paper and other office supplies for $95. (Use Supplies.)

14 Cookie Creations pays $125 to purchase baking supplies, such as four, sugar, butter, and chocolate chips. (Use Supplies.)

15 Natalie starts to gather some baking equipment to take with her when teaching the cookie classes. She has an excellent top-of-the-line food processor and mixer that originally cost her $550. Natalie decides to start using it only in her new business. She estimates that the equipment is currently worth $300, and she transfers the equipment into the business in exchange for additional common stock.

16 The company needs more cash to sustain its operations. Natalie’s grand-mother lends the company $2,000 cash, in exchange for a two-year, 9% note payable. Interest and the principal are repayable at maturity.

17 Cookie Creations pays $900 for additional baking equipment.

18 Natalie schedules her first class for November 29. She will receive $100 on the date of the class.

25 Natalie books a second class for December 5 for $150. She receives a $60 cash down payment, in advance.

29 Natalie teaches her first class, booked on November 18, and collects the $100 cash.

30 Natalie’s brother develops a website for Cookie Creations Inc. that the company will use for advertising. He charges the company $600 for his work, payable at the end of December. (Because the website is expected to have a useful life of two years before upgrades are needed, it should be treated as an asset called Website.)

30 Cookie Creations pays $1,200 for a one-year insurance policy.

30 Natalie teaches a group of elementary school students how to make Santa Claus cookies. At the end of the class, Natalie leaves an invoice for $300 with the school principal. The principal says that he will pass it along to the business office and it will be paid some time in December.

30 Natalie receives a $50 invoice for use of her cell phone. She uses the cell phone exclusively for Cookie Creations Inc. business. The invoice is for services performed in November, and payment is due on December 15.

Instructions

(a) Prepare journal entries to record the November transactions.

(b) Post the journal entries to the general ledger accounts.

(c) Prepare a trial balance at November 30, 2014.