Question
Jims Shoes is a sole owner and has paid in capital and borrowed money to start his business. He has cash, inventory and a car,
Jims Shoes is a sole owner and has paid in capital and borrowed money to start his business. He has cash, inventory and a car, as well as, office supplies, shelves and a sign. He owes is shoe supplier some money for his inventory and has a bank loan. Each month he sells a few shoes on credit and has to pay his one employee, as well as, rent, the electric bill and water bill.
During his first month of operations, Jim invests $400 in his company in cash, Jim borrows $500 from his mom, Jim buys 6 pairs $300 worth of shoes on credit from his supplier, Jim pays $200 for rent, Jim buys a car on bank credit for $1,000, Customer Bob buys 1 pair of shoes for $100, Jim buys a sign for $50, and 10 Shelves $10 each, Jim pays the water bill $25 and electric $35, Jim hired Don and paid him $50 to sell his shoes, Jim prepaid $60 for insurance, the annual premium on credit
From the following transactions form a balance sheet and income statement.
1-Mar Cash $400
Owner Equity $400
2-Mar Cash $500
AP-Mom $50
3-Mar Inventory $300
AP-Nike $300
4-Mar Rent Expense $200
Cash $200
5-Mar Automobile $1000
Auto Loan $1000
6-Mar Cash $100
Sales Revenue $100
6-Mar COGS $50
Inventory $50
7-Mar Fixtures $150
Cash $150
8-Mar Utilities $60
Cash $60
9-Mar Wages/Salaries Expense $50
Cash $50
10-Mar Prepaid Insurance $60
AP-Insurance $60
30-Mar Insurance Expense $5
Prepaid Insurance $5
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