Part Five Instructions Before preparing the Financial Statements make sure all the assignments have been corrected in your spreadsheets. Prepare the Financial Statements listed below using Excel. a. Adjusted Trial Balance b. Income Statement c. Statement of Retained Earnings d. Balance Sheet Once you finish the Financial Statements follow the instructions below: Step 1: Enter the journal entries into the Excel Template spreadsheet and when completed print it out. Step 2: Use the Excel spreadsheet to answer the questions in Blackboard for the corresponding week in the content folder. Step 3: Once you complete entering information into Blackboard, upload the spreadsheet into Blackboard by clicking on the navigation pane then clicking on Practice Set. 16 Page 5. 9/03/23 6. 9/05/23 9 Deposit #2 7. 9/05/23 Ck #1003 8. 9/06/23 Ck #1004 6 9. 9/06/23 Ck #1005 10. 9/08/23 11. 9/08/23 12. 9/13/23 13. 9/18/23 Ck #1006 14. 9/18/23 15. 9/18/23 16. 9/18/23 17. 9/19/23 Deposit #3 Purchased a new register/computer system that cost $3,600 from Office Mart for use in the business. Ms. Boone signed a six-month, 12% installment note payable for the cost of the system. The computer system has an estimated useful life of 4 years and the residual (salvage) value is $0. This will be recorded as Computer Equipment and depreciated using the Straight-Line Depreciation method. The depreciation will be recorded in the adjusting journal entries in part 2. Signed a note payable to borrow $5,000 from Wells Fargo Bank. Interest is 9% annually and the note is to be repaid with interest in six months. Purchased a delivery van for $16,000 from Marvin's Motors. The estimated service life of this asset is 5 years. The residual (salvage value) is $1,000. This will be recorded as Delivery Van and depreciated using the Straight-Line Depreciation Method in the adjusting journal entries. Depreciation will be recorded in the adjusting entries in part 2. Paid $600 to have Bella's logo painted on the side of the van. This should be added to the cost of the van and depreciated over the life of the van. Paid $500 for business cards, flyers, and posters. This will be recorded as prepaid advertising. Purchased $900 of inventory-helium from Hector's Helium on account. The vendor extended credit terms of 2/15, n/30. Purchased $6,200 of inventory-balloons from Balloon Blast on account. The vendor extended credit terms of 2/15 n/30. Ms. Boone received and paid the $800 charge from her lawyer. Bella's Balloon Bouquet, Inc. is now open for business. Sales will be both retail and wholesale. Retail customers will purchase online and at the shop and will be charged an 8.25% sales tax. Ms. Boone will allow major customers to charge their purchases on account and then pay later. Sold a balloon arch to UTEP for homecoming on account for $4,000. The cost of the balloons is $1,700. The cost of the helium is $500. UTEP does not have to pay sales tax on the purchase. Purchased $300 of ribbon and string (used in making the arrangements) on account. This is to be treated as supplies. Purchased additional balloons from Balloon Blast on account, for $7,500. Credit terms are 2/10, n/30. Recorded cash sales for the first five days of operation. Sales totaled $6,000 and the sales tax collected totaled $495. A total of 719age 18. 9/20/23 Ck #1007 19. 9/22/23 20. 9/22/23 Ck #1008 21. 9/23/23 Deposit #4 22. 9/23/23 23. 9/23/23 Ck #1009 24. 9/23/23 25. 9/23/23 Ck #1010 Deposit #5 26. 9/23/23 27. 9/25/23 Ck #1011 Deposit #6 28. 9/28/23 29. 9/30/23 Ck #1012 30. 9/30/23 Deposit #7 Ck #1013 31. 9/30/23 32. 9/30/23 Ck #1014 $6,495 was deposited in the bank. The cost of merchandise sold was $4,200. (Balloons were $3,900 and helium was $300) Received and paid the $300 invoice for supplies, string, ribbons purchased on 9/18/23. Paid the invoice from Hector's Helium from 9/08/23 Ordered $700 of helium on account. Ms. Boone donated a balloon bouquet to the Humane Society fund raiser. She felt that this was a good way to advertise her new business. Her business was listed as a sponsor and a large ad was put in the fund raiser program. Cost of the balloons were $600 and the helium was $100. Ms. Boone considers this an advertising expense. Received payment in full from UTEP. The payment was deposited in the bank. Ms. Boone paid her credit card bill for the month. The bill was $300 which was for gas for the delivery van and $50 was for decorative ribbons used for the Humane Society balloon arrangement. Purchased and paid for $50 of shipping supplies. Internet and retail sales totaled $7,000 and sales taxes of $560 was collected. The cost of the merchandise sold was $4,500 (Balloons $4,000; Helium $500). The money was deposited in the bank. Paid the balance due to Balloon Blast. There are two invoices; one on 9/8/23 and the other on 9/18/23. Collected and deposited $2,300 of payments. Sales tax totaled $189.75. The cost of the merchandise sold was $1,050. (Balloons $1,000; Helium $50). Received but did not pay the utility bill for the month, $120. Paid the first monthly installment on the computer equipment. The payment amount is $636. Of this amount, $36 is for interest and $600 is for principal. Make the check payable to Office Mart. Recorded internet sales for the last week of the month. Sales of $3,400 were deposited. The cost of the merchandise sold was $1,250 (Balloons $1,200; Helium $50). Sales tax collected is $280.50. Paid all sales tax owed for September to the Comptroller of Public Accounts. Declared and paid a cash dividend of $100 to Bella Boone. 350 50 81Page Transactions Date Deposit No. /Check No. 1. 9/02/23 2. 9/02/23 Deposit #1 3. 9/03/23 Ck #1001 4. 9/03/23 Ck #1002 Description Bella Boone met with her lawyer and CPA for advice on starting the business. They decided that Ms. Boone would organize the business as a corporation. The lawyer told Ms. Boone to register the company name, "Bella's Balloon Bouquet, Inc." with the County of El Paso. In addition, Ms. Boone will get an employer identification number (EIN) from the Internal Revenue Service and get a sales tax permit from the state of Texas. The lawyer agreed to prepare the Articles of Incorporation to be filed with the Secretary of State of Texas. The CPA has agreed to help Ms. Boone set up her accounting system. Ms. Boone opened a business checking account at Wells Fargo Bank by depositing the personal check she gave her company for $20,000. The corporation issued her a stock certificate for 1,000 shares of common stock. Ms. Boone signed a one-year rental agreement with Reynolds Realtors for shop space. She was required to pay $2,400 for rent for the months of September 1, 2023- December 31, 2023. Arranged for a general business liability insurance policy and paid $2,800 to State Penn Insurance. This premium is for six months coverage.