Lisa Frees and Amelia Ellinger have been operating a catering business for several years. In March, the partners plan to expand by opening a retail sales shop. They have decided to form the business as a corporation called Traveling Gourmet, Inc. The following transactions occurred in March: a. Received $102,000 cash from each of the two shareholders to form the corporation, in addition to $4,200 in accounts receivable, $9,700 in equipment, a van (equipment) appraised at a fair value of $17,400, and $2,300 in supplies. Gave the two owners each 940 shares of common stock with a par value of $1 per share. b. Purchased a vacant store for sale in a good location for $580,000, making a $116,000 cash down payment and signing a 10-year mortgage note from a local bank for the rest. c. Borrowed $72,000 from the local bank on a 10 percent, one-year note. d. Purchased food and paper supplies costing $14,600 in March; paid cash. e. Catered four parties in March for $6,400; $2,040 was billed and the rest was received in cash f. Sold food at the retail store for $18,000 cash; the food and paper supplies used cost $11,270. (Hint: Record the revenue effect separate from the expense effect.) g. Received a $640 telephone bill for March to be paid in April. h. Paid $583 in gas for the van in March. i. Paid $10,680 in wages to employees who worked in March. j. Paid a $520 dividend from the corporation to each owner. k. Purchased $72,000 of equipment (refrigerated display cases, cabinets, tables, and chairs) and renovated and decorated the new store for $31,000 (added to the cost of the building); paid cash. Answer is not complete. BOG Acocunt Roosivable DO 4.2001 2,040 Boga ( 204.000 c) 72,000 14.00 18,000 la 116.000 14.500G 10,00 EndBal 5.340 10.000 Buppies Equipment COCO BOLO 200 27.100 540 72.000 End End Be .100 Buning Blog Accounts Payable Beg Bell 540 IK 50 000 31.000 End 11,000 End Bal 540 Note Payable Bog Balo 72.000 Mortgage Payable Bag Ball 464.000 End Sal 72.000 End Bal End 464.000 Common Book Additional Pald-in Capital Bog Bar Bog Bal 1 0 236.720 End Bal End Bal 235.720 Revenue Food Beg Ball Bed Bal 0 1040 120005 End Bal End Bal 18.000 Buple Expense Ben Bal l lll 1.2 400 End Bol 1 1.270 Wages Expence Beg Bell 10, 1 End Bal 10,500 Fuel Expand Bog Bal Required: 1. Prepare an unadjusted classified income statement in good form for the month of March. TRAVELING GOURMET, INC. Income Statement (unadjusted) For the Month Ended March 31 Revenues: Catering sales revenue Food sales revenue Total revenues Expenses: Supplies Total costs and expenses
