2. 1. This is an example that illustrates accounting capturing organization history on an event-by-event basis. This means that whenever an event happens, the accounting system records the event. The lectures have a brief review of the accounting cycle. The text has three chapters, pages 327 through 472, that describes the accounting cycle. For the exam, you will want to be able to 3. a. b. Given an event, provide the journal entry. Given a journal entry, describe the effect on the assets, liabilities, shareholders' equity, revenues, and expenses. 4. Here are some check figures: Net Income is $18,233 Total Assets are $123,083 Total Liabilities are $14,850 Shareholders' Equity is $108,233 Problem statement: Bob's Chocolate Chips and More, a bakery specializing in gourmet pizza and chocolate chip cookies, started business October 1, 2023. The following transactions occurred during the month. a. Common stock of $90,000 was sold at par to start the business. b. Equipment, consisting of mixers and ovens, was acquired October 1 for $30,000 cash. The equipment is expected to last five years and can be sold at that time for $5,000. Management uses the straight-line method to calculate depreciation expense. c. Ingredients costing $15,000 were purchased on account during the month and all but $5,000 was paid for by the end of the month. d. Rent is $500 a month. October, November, and December's rent was paid October 5. e. A payment of $800 for utilities was made during the month. f. Sixty percent of the ingredients purchased in part c were prepared and sold for $35,000 on account; $26,000 was collected on accounts receivable during the month. g. Wages of $5,200 were paid during the month. Moreover, wages for the last three days of the month amounted to $400 and will be paid during the first week of November. h. Borrowed $12,000 as a Note Payable from the bank for additional working capital requirements, and $3,000 was repaid by month-end. Interest on the unpaid loan balance amounted to $450 at the end of October and was paid on November 5. Required: 1. Prepared the journal entries and adjusting entries. 2. Prepare the income statement for October. 3. Prepare the balance sheet as of October 31, 2023.