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CP3-3 (Algo) Analyzing the Effects of Transactions Using T-Accounts, Preparing an Unadjusted Trial Balance, and Determining Net Income and Net Profit Margin [LO 3-1, LO

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CP3-3 (Algo) Analyzing the Effects of Transactions Using T-Accounts, Preparing an Unadjusted Trial Balance, and Determining Net Income and Net Profit Margin [LO 3-1, LO 3-2, LO 3-3, LO 3-4, LO 3-5] Barbara Jones opened Barb's Book Business on February 1. You have been hired to maintain the company's financial records. The following transactions occurred in February, the first month of operations, a. Received shareholders' cash contributions on February 1 totaling $12,000 to form the corporation; issued 1,000 shares of common stock. b. Paid $2.715 cash on February 2 for three month' rent for office space. TIP: For convenience, simply record the full amount of the payment as an asset (Prepaid Rent). At the end of the month, this account will be adjusted to its proper balance. c. Purchased and received supplies on February 3 for $335 cash. d Signed a promissory note q n February 4 , payable in two years; deposited $15,200 in the company's bank account. e. On February 5, paid cash to buy equipment for $6,400 and land for $8,800. f Placed an advertisement in the local paper on February 6 for $680 cash. g. Recorded sales on February 7 totaling $4,200,$2,040 was in cash and the rest on accounts receivable. h. Collected accounts recelvable of $65 from customers on February 8 . 1. On February 9, repaired one of the computers for $200 cash. TIP. Most repairs involve costs that do not provide additional future economic benefits. j. Incurred and paid employee wages on February 28 of $655 Required: 1. Prepare the journal entry for each of the above transactions. 2. Post the transaction activity from requirement 1 to the T-Accounts below. All accounts begin with zero balances because this is the first month of operations. 3. Prepare an unadjusted trial balance at the end of February. 4-o. Refer to the revenues and expenses shown on the unadjusted trial balance. Based on this information, calculate preliminary net income and net profit margin? 4.b. Determine whether the net profit margin is better or worse than the 11.5 percent eamed by a close competitor. Complete this question by entering your answers in the tabs below. Prepare the journal entry for each of the above transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

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