John Smith and Abby Jones decide to merge their small businesses. John owns a lawncare business and Abby has a shop that sells parts for small engine repair. Sales Tax will be paid on merchandise ONLY at a rate of 5%. Merchandise is marked up by 100%.

Jan 1 John brings the following to the business: Accounts Receivable-$2,500 (which is broken down to Sub Shop $750, Adirondack Tires $1,000 and The Pizza Place $750), Allowance for Doubtful Accounts-$500, Supplies-$400, and Equipment-$10,000

Jan 1 Abby invests the following in the business: Cash-$7,000, Inventory-$2,000

**John and Abby agree to take a salary of $1,000 a month each and split the remaining equally.

Jan 3 Hired Mr. Lebideker to design a new business logo. He billed $300.

Jan 4 Paid Nate $200 to create social media posts.

Jan 4 Received $500 from Adirondack Tires.

Jan 4 Paid a 6 month insurance policy for $1,200.

Jan 5 Brendas Barbershop pays the business $1,000 for 4 months worth of lawn care.

Jan 7 Sold $200 of merchandise (sales tax not included) to Adirondack Tires on account.

Jan 8 Purchased equipment for the business paying with a 3 month, 8% note with a face value of $12,000.

Jan 10 Cash sales for the week total $1,200 plus sales tax.

Jan 10 Purchased additional inventory (merchandise) totaling $575 on account from Parts Nation.

Jan 10 Bought supplies for cash totaling $150.

Jan 12 Recorded cash payments for lawn care service, $5,550.

Jan 13 Sold an old lawnmower for $1,000 that booked for $1,250.

Jan 17 Cash sales for the week total $1,000 plus sales tax.

Jan 17 Payroll for part time employees for a two week period is as follows:

Employee	Hours	Rate	Fed Inc Tax
Sylvia	50	$15	$30
Joe	70	$20	$50
Calvin	70	$20	$45
Stefanie	70	$25	$60

FICA tax is 7.65%. Record the payroll.

Jan 18 Pay payroll.

Jan 18 Record payroll taxes. The company is subject to 5.4% state unemployment and 0.8% federal unemployment in addition to FICA tax.

Jan 20 Received a 30 day, 5% note from The Sub Shop to pay off their account.

Jan 21 Established a petty cash fund of $200.

Jan 22 John Smith withdrew $500 for personal use.

Jan 23 Abby Jones withdrew $500 for personal use.

Jan 24 Recorded cash payments for lawn care service, $3,500. Make use of Sales, Cash Receipts, Purchases, Cash Payments, General.

The following are the accounts used: Accounts Receivable, Cost of Goods Sold, Inventory, Sales Discounts, Sales Revenue, Other Accounts, Accounts Payable, Cash.

Post all transactions. MOST accounts have been added to the ledger.