Transaction Analysis, Trial Balance. McDonald's Corporation is a well-known fast- food restaurant company. Examine the accompanying balance sheet values, which are based on McDonald's annual report and actual terminology.

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McDonald's Corporation Balance Sheet Values, January 1, 2003 ($ in millions) Cash $ 330 Accounts and notes receivable 855 Inventories 112 Prepaid expenses 418 Property and equipment, at cost 26,219 Other assets 3,672 Accumulated depreciation $ 7,635 Notes and accounts payable Other liabilities 636 13,054 Paid-in capital Retained earnings Other stockholders' equity* Total $31,606 1,764 19,204 (10,687) $31,606 *These negative stockholders' equity items will be explained in later chapters. Consider the following assumed partial summary of transactions for 2003 ($ in millions): a. Revenues in cash, company-owned restaurants, $2,100. b. Revenues, on open account from franchised restaurants, $500. Open a separate revenue account for these sales. c. Inventories acquired on open account, $827. d. Cost of the inventories sold, $820. e. Depreciation, $226 (Debit Depreciation Expense). f. Paid rent and insurance premiums in cash in advance, $42 (Debit Prepaid Expenses). g. Prepaid expenses expired, $37 (Debit Operating Expenses). h. Paid other liabilities, $148. i. Cash collections on receivables, $590. j. Cash disbursements on notes and accounts payable, $747. k. Paid interest expense in cash, $100. 1. Paid other expenses in cash, mostly payroll and advertising, $1,510 (Debit Operating Expenses). Required 1. Record the transactions in the journal. 2. Enter beginning balances in T-accounts. Post the journal entries to the T-accounts. Key your entries with the transaction letters used here. 3. Prepare a trial balance, December 31, 2003, for the year ended December 31, 2003.