Assume there is a small shoe store in your neighborhood with a single owner. The owner started

the business on December $1,2021,$ and sells two types of shoes: a comfortable sneaker that is

something athletes would purchase, and a comfortable dress shoe that looks dressy but has the

comfort of a sneaker. The name of the business is The Shoe Horn. Complete tasks A and B that

follow, using the detailed instructions for each. Following is a list of all transactions that

occurred during December $2021.$

a$.$ Dec. $1$ Jack Simmons, the owner contributed a $$500,000$ check from his personal account,

which he deposited into an account opened in the name of the business, to start the

business.

b$.$ Dec. $1$ He rented space that had previously been used by a shoe store and wrote check no$.$

$100$ for $$9,000$ for the first six month's rent.

c$.$ Dec. $2$ He paid for installation and phone usage $$300($check no$.101)$

d$.$ Dec. $2$ He paid for advertising in the local paper $$150($check no$.102).$ The ads will all run

in December.

e$.$ Dec. $2$ He purchased $$500$ of office supplies $($check no$.103)$

f$.$ Dec. $3$ He paid $$300$ for insurance for three months $($December $2021,$ January and February

$2022$ using check no$,104).$

g$.$ Dec. $4$ He purchased $800$ pairs of sneakers at $$40$ a pair$-$ on account from Nike $($using

purchase order no$.301).$ Assume the shoe store uses the perpetual inventory system.h$.$ Dec. $5$ He purchased $500$ pairs of dress shoes from Footwear Corp. on account for $$20a$

pair $($using purchase order no$.302).$

i$.$ Dec. $10He$ made a sale on account of $20$ pairs of sneakers at $$100$ a pair, to a local

University $-$ Highland University $($sales invoice number $2000)$ for their basketball

team. Payment terms were $\frac{2}{10}$ net $30.$

j$.$ Dec. $11$ He made a sale on account of $2$ pairs of dress shoes at $$50$ a pair $($sales invoice no$.$

to a local charity, U$.$S$.$ Veterans, that intended to raffle them off at one of their

events.

k$.$ Dec. $12$ He made a sale on account to The Jenson Group of $300$ pairs of dress shoes at $$50$ a

pair, to use as part of an employee uniform. Payment terms were $\frac{2}{10}$ net $30.$

Dec. $14He$ made a cash sale for $2$ sneakers at $$120$ each and $1$ pair of shoes for $$60.$

m$.$ Dec. $14$ He paid the amount owed to Footwear Corp $($check no $105)$

n$.$ Dec. $17$ Highland University returned $2$ pairs of sneakers they had previously purchased on

account.

o$.$ Dec. $18$ He received a check from Highland University in full payment of their balance.

p$.$ Dec. $20$ He made a cash sale to Charles Wilson of three pairs of sneakers at $$120$ each and $1$

pair of dress shoes at $$60.$

q$.$ Dec. $20$ He made a partial payment to Nike for $$20,000($check number $106)$

r$.$ Dec. $27$ Received a check from The Jenson Group in the amount of $$9,000.$

s$.$ Dec. $28$ He paid $$2,000$ of his balance to Nike $($check number $107)$

Enter all of the transactions and complete all of the steps in the accounting cycle assuming a

manual system. Follow the steps to be pefformed using a manual system.

$3)$ Open up Accounts Receivable subsidiary ledger accounts for customers and Accounts

Payable subsidiary ledger accounts for vendors using the format provided. Post each

entry to the appropriate subsidiary ledger on the date the transaction occurred.

$4)$ Total the four special journals, and post from all of them to the general ledger on the last

day of December. You should open ledger accounts for the following accounts:

o Cash

o Accounts Receivable

o Merchandise Inventory

o Prepaid Insurance

o Prepaid Rent

o Office Supplieso Accounts Payable

o Utilities Expense Payable

o Jack Simmons, Capital

o Sales

o Sales Returns and Allowances

o Sales Discounts

o Cost of Goods Sold

o Rent Expense

o Advertising Expense

o Telephone Expense

o Utilities Expense

o Office Supplies Expense

o Insurance Expense

$5)$ Compute balances for each general ledger account and for each accounts recievable and accounts payable subsidiary ledger account.