Project #$2$

Great Bay Community College

Assume there is a small shoe store in your neighborhood with a single owner. The owner started the business on December $1,2022,$ and sells two types of shoes: a comfortable sneaker that is something athletes would purchase, and a comfortable dress shoe that looks dressy but has the comfort of a sneaker. The name of the business is The Shoe Horn.

For each of the transactions listed for the month of December $2022,$ identify the journal to which the entry should be recorded. Your possible choices are as follows: general journal $($GJ$),$ cash receipts journal $($CR$),$ cash disbursements journal $($CD$),$ sales journal $($SJ$),$ or purchases journal $($PJ$).$ Templates for the journals and ledgers have been provided. Post each transaction in the appropriate journal.

Post the Journals to the General Ledger and the Subsidiary Ledgers.

Prepare the Trial Balance, and the AR and AP Schedules

a$.$ Dec. $1$ Jack Simmons, the owner contributed a $$500,000$ check from his personal account, which he deposited into an account opened in the name of the business, to start the business.

b$.$ Dec. $1$ He rented space that had previously been used by a shoe store and wrote check no$.100$ for $$9,000$ for the first six month's rent.

c$.$ Dec. $2$ He paid for installation and phone usage $$300($check no$.101)$

d$.$ Dec. $2$ He paid for advertising in the local paper $$150($check no$.102).$ The ads will all run in December.

e$.$ Dec. $2$ He purchased $$500$ of office supplies $($check no$.103)$

f$.$ Dec. $3$ He paid $$300$ for insurance for three months $($December $2018,$ January and February $2019$ using check no$,104).$

g$.$ Dec. $4$ He purchased $800$ pairs of sneakers at $$40$ a pair$-$ on account from Nike $($using purchase order no$.301).$ Payment terms were $\frac{2}{10},$ net $30.$ Assume the shoe store uses the perpetual inventory system.

h$.$ Dec. $5$ He purchased $500$ pairs of dress shoes from Footwear Corp. on account for $$20$ a pair $($using purchase order no$.302).$ Payment terms were $2/10,$ net $30$

i$.$ Dec. $10$ He made a sale on account of $20$ pairs of sneakers at $$100$ a pair, to a local University Highland University $($sales invoice number $2000)$ for their basketball team. Payment terms were $2/10$ net $30.$

j$.$ Dec. $11$ He made a sale on account of $2$ pairs of dress shoes at $$50$ a pair $($sales invoice no$.2001)$ to a local charity, U$.$S$.$ Veterans, that intended to raffle them off at one of their events.

k$.$ Dec. $12$ He made a sale on account to The Jenson Group of $300$ pairs of dress shoes at $$50$ a pair, to use as part of an employee uniform. Payment terms were $2/10$ net $30.$

I. Dec. $14$ He made a cash sale for $2$ sneakers at $$120$ each and $1$ pair of shoes for $$60.$

m$.$ Dec. $14$ He paid the amount owed to Footwear Corp $($check no $105)$

n$.$ Dec. $17$ Highland University returned $2$ pairs of sneakers they had previously purchased on account.

o$.$ Dec. $18$ He received a check from Highland University in full payment of their balance.

p$.$ Dec. $20$ He made a cash sale to Charles Wilson of three pairs of sneakers at $$120$ each and $1$ pair of dress shoes at $$60.$

q$.$ Dec. $20$ He made a partial payment to Nike for $$20,000($check number $106)$

r$.$ Dec. $23$ Received a $$400$ utility bill which will be paid in January.

s$.$ Dec. $27$ Received a check from The Jenson Group in the amount of $$9,000.$

t$.$ Dec. $28$ He paid $$2,000$ of his balance to Nike $($check number $107)$

Chart of Accounts

$1100$ Cash

$1120$ Accounts Receivable

$1130$ Merchandise Inventory

$1140$ Prepaid Insurance

$1150$ Prepaid Rent

$1160$ Office Supplies

$2100$ Accounts Payable

$3100$ Jack Simmons, Capital

$3200$ Jack Simmons, Drawing

$4000$ Sales

$4100$ Sales Returns and Allowances

$4200$ Sales Discounts

$5000$ Cost of Goods Sold

$5100$ Rent Expense

$5110$ Advertising Expense

$5115$ Telephone Expense

$5130$ Utilities Expense

$5140$ Office Supplies Expense

$5150$ Insurance Expense