Problem 2-6 Journal entries and statement preparation (LO2-12) Bob's Chocolate Chips and More, a bakery specializing in gourmet pizza and chocolate chip cookies, started business October 1, 20X1. The following transactions occurred during the month of October. a. Common stock of $90,000 was sold at par to start the business. b. Equipment consisting of mixers and ovens was acquired October 1 for $30,000 cash. The equipment is expected to last five years, after which it is expected to be sold for $5,000. Management uses the straight-line method to calculate depreciation expense. C. Ingredients costing $15,000 were purchased on account during the month and all but $5,000 was paid for by the end of the month. d. Rent is $500 a month. October, November, and December's rent was paid October 5. e. A payment of $800 for utilities was made during the month. f. Sixty percent of the ingredients purchased in part c were prepared and sold for $35,000 on account; $26,000 was collected on accounts receivable during the month. g. Wages of $5,200 were paid during the month. Moreover, wages for the last three days of the month amounted to $400 and will be paid during the first week of November. h. Borrowed $12,000 from the bank for additional working capital requirements, and $3,000 was repaid by month-end. Interest on the unpaid loan balance amounted to $450 at the end of October and was paid on November 5. Required: Prepare the required journal entries and adjusting entries as well as an October income statement and a balance sheet as of October 31, 20X1, for Bob's Chocolate Chips and More. (Hint. You may want to consider using T-accounts to classify and accumulate the preceding transactions before preparing the statements.)

3 Required: Prepare the required journal entries and adjusting entries as well as an October income statement and a balance sheet as 31, 20X1, for Bob's Chocolate Chips and More. (Hint. You may want to consider using T-accounts to classify and accumulate preceding transactions before preparing the statements.) Answer is not complete. Complete this question by entering your answers in the tabs below. Prepare Bob's adjusting entries for the October transactons. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your final answers to the nearest whole dollar.)