HOMEWORK ASSIGNMENT #1 JOURNAL ENTRIES FOR FRESH MARKET, INC.

The following transactions occurred for Fresh Mark et, Inc. for the quarter ended March 31, 2009

: Total sales were $ 484,500 20% were on account

. Of those sales on account, 95% were collected by the end of the quarter.

$ 258,000 was spent buying produce to stock the store.

By the end of the quarter, all but $ 6,060 of the produce has been sold.

Payments were made for the following:

1. Salaries and Wages $ 130,000

2. Utilities $ 8,835

3. Rent $ 13,950

4. Supplies $ 17,000

5. Equipment Repairs $ 4,410

6. Loan Payments - $ 4,500 on principal and $ 3,150 for interest

Depreciation on Store Fixtures and Equipment was $ 7,230

. An estimated income tax payment for $ 19,130 was made.

$ 1,940 in Supplies were unused at the end of the quarter.

Employees earned $ 2,100 in wages that wont be paid until the third day of the next quarter.

REQUIRED

1. Prepare the journal entries to reflect the above transactions.

2. Circle every account in the journal entr y that is a Balance Sheet account.

3. Did the Cash account increase or decrease during the quarter? By how much?

4. Prepare an Income Statement for th e Quarter ended March 31, 2009.