a.) Create a journal entry for all the transactions. Background: Prepare the financial statements for following Baker's Bikes. Baker's Bikes is a local bike repair, sales and service shop specializing in road bikes. Baker's Bikes earns revenue through a.) service of bicycles b.) selling new bicycles. Assignment: Create journal entries Conditions & Constraints: Under the following circumstances. Transactions occur only once (unless otherwise indicated). The accounting period is from January 1, 2021 until October 31,2021 Baker's bikes records cost-of-good sold under the FIFO method. Assets unless otherwise indicated should be amortized under straight-line amortization. All the types of bikes can be recorded as bikes. Unless specified on account all transactions are in cash. Tim sells three bikes to Arnold for $1000 each. $2000 was paid in cash. 4/1 3/10 Tim buys merchandise inventory from Giant Bikes of 5 bikes on account shipping terms destination for $500 each, credit terms 2/12 n 20. 3/20 Tim pays his bill to Giant Bikes. 3/20 Tim pays his bill with Scott Bikes. 3/30 4/1 4/10 4/10 4/20 Tim buys 10 bikes from his supplier for $300 each. Tim purchases advertising space in a Sports & Bikes, a local magazine for $100 one month on account starting 5/1. Thomas returns on of the bikes for a full refund. A small marketing company is hired to help building a website and social media advertising. The marketing company charges a total $1500, although $2000 is paid for future work on social media account although terms are not settled. 5/1 Tim purchases an air pump for $200 with 1000 ft^3 of gas, meant to service 5,000 tires with a residual value of $20. Tim sells 1 bike for cash $2200. Sachin sells 2 bikes for $1500 and $1600. Principles: Payroll 6/1 6/1 Adjusting of Accounts Closing the Accounts Tim forms a partnership with a another local bike shop Bob's Bikes to form Bob & Baker's Bikes with a 50/50 slip for the contribution of 30 bicycles, and $5,000 with no other bicycles. 6/1 Tim pay his bill with Sports & Bikes. 6/12 Bob & Baker's Bikes sells 3 bikes. One Year of Financial Transactions, for the period: 6/20 Date Activity Notes account, credit terms 2/5 n 10. 1/12 1/14 Tim Baker deposits $10,000 of his own capital to start the business. Tim Baker purchases branding and advertising materials for $500 7/1 * Advertising 7/1 1/17 1/18 Baker purchases a stand and tools with a useful life of 20 years for $1,000 Baker purchases office equipment including a laptop for $1000 cash. 2/1 Expenses Merchandise inventory of 10 bikes are purchased for $600 per bike on Bob & Baker's Bikes sells the equipment and tools purchased for $1000 for $600. * Equipment 7/5 3 bikes are sold for $1000 each. 7/6 2 bikes are stolen. 8/1 2/1 2/5 Tim hires Sachin Patel, to run the sales floor and fix bikes. Sachin will work 30 hours per week and receive Tim buyers ten bicycles on account from Scott for $500 each on account terms 2/10 n 30 8/1 8/1 8/10 Bob & Baker's Bikes sells 5 bikes for $1000. Bob & Baker's Bikes performs 2 tune ups for $50 each. Tim purchases merchandise inventory of 10 bikes from Giant for $250 on account. 2/6 Tim sells 2 bikes for $1100 each. 9/1 2/10 Tim collects performs services on account for Jacob for $75 9/1 2/1 2/14 Tim Baker buys three bicycles merchandise on account $1,500 term 2/10 n 30. Sells 3 9/10 Bob & Baker's Bikes raised long-term debt of $5,000. Bob & Baker's Bikes sells 4 bikes for $1,000 each. 3/1 3/1 Tim buys a one year business insurance policy for $100 per month. 10/1 3/1 Tim Baker sells his long-lived assets. 3/1 Tim sells two bicycles to a couple for $1000 each for cash. 3/2 Tim performs 3 tune ups for $50 each. 3/4 Tim performs three tune ups for $50 each. 3/5 Sachin sells 3 bikes at $1100 each. Record depreciation. 10/1 10/2 10/5 Bob & Baker's Bikes buys shares 10 shares of ABC company for $1000. Bob & Baker's Bikes determine to pay themselves a salary of $1,000 a month. Bob & Baker's Bikes performs 5 tune-ups for $50 each. 10/6 Bob & Baker's Bikes sells 3 bikes for $2,000 each. 11/1 Bob & Baker's Bikes sells 5 their shares of ABC company for $400.