Question
Record the May transactions in the general journal C hart of Accounts Current Assets 10000 Cash 11000 Accounts Receivable Long-Term Liabilities 27000 Mortgage Payable 27100
Record the May transactions in the general journal
Chart of Accounts
Current Assets | |
10000 | Cash |
11000 | Accounts Receivable |
Long-Term | Liabilities |
27000 | Mortgage Payable |
27100 | Note Payable |
12000 | Inventory Cookies |
12100 | Inventory Baskets |
13100 | Supplies (Ribbon, Sticks, Cellophane) |
13200 | Shipping Supplies |
14000 | Prepaid Rent |
14100 | Prepaid Insurance |
14200 | Prepaid Advertising |
|
Stockholders Equity | |
39003 | Common Stock |
39005 | Retained Earnings |
39007 | Dividends |
Revenue | |
40000 | Sales |
Long-Term Assets | |
15000 | Computer Equipment |
17000 | Accumulated Depreciation Computer Equipment |
15100 | Delivery Van |
|
|
17100 | Accumulated Depreciation-Delivery Van |
Expenses | |
50000 | Cost of Goods Sold |
60100 | Legal Expense |
60150 | Supplies Expense |
60200 | Shipping Supplies Expense |
60300 | Insurance Expense |
60350 | Wages Expense |
60400 | Credit Card Expense |
60500 | Advertising and Promotion Expense |
60550 | Utility Expense |
60600 | Rent Expense |
60650 | Depreciation Expense |
60700 | Interest Expense |
60750 | Bank Service Fee |
Current Liabilities | |
20000 | Accounts Payable |
21100 | Note Payable Wells Fargo Bank |
21200 | Note Payable Office Mart |
23100 | Wages Payable |
23200 | Interest Payable |
23300 | Sales Tax Payable |
| Date | Deposit No. / Check No. | Description |
| 5/02/16 |
| Courtney Cooper met with her lawyer and CPA for advice on starting the business. They decided that Ms. Cooper would organize the business as a corporation. The lawyer told Ms. Cooper to register the company name Courtneys Cookie Bouquet with the County of El Paso. In addition, Ms. Cooper 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. Cooper set up her accounting system. |
| 5/02/16 | Deposit #1 | Ms. Cooper opened a business checking account at Wells Fargo Bank by depositing $35,000. The corporation issued her a stock certificate for 35,000 shares of common stock with no par value. |
| 5/03/16 | Ck #1001 | Ms. Cooper signed a one-year rental agreement with Reynolds Realtors for warehouse space. She was required to pay $2,400 for rent for the months of May 1, 2016 August 31, 2016. |
| 5/03/16 | Ck #1002 | Arranged for a general business liability insurance policy and paid $2,700 to State Penn Insurance. This premium is for twelve months coverage. |
| 5/04/16 |
| Signed a one year note with Office Depot for a Computer that cost $3,600 and interest is 6%. There will be no residual value at the end of five years. |
| 5/05/16 | Deposit #2 | Signed a note payable to borrow $10,000 from Wells Fargo Bank. Interest is 9% annually and the note is to be repaid with interest in six months. |
| 5/05/16 | Ck #1003 | Purchased a delivery van for $16,000 from Marvins 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 accordingly. |
| 5/06/16 | Ck #1004 | Paid $600 to have Courtneys 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. |
| 5/06/16 | Ck #1005 | Paid $500 for business cards, flyers, and posters. This will be recorded as prepaid advertising. |
| 5/08/16 |
| Purchased $6,200 of merchandising inventory (cookies) from Courtneys Cookies on account. |
| 5/08/16 |
| Purchased $2,900 of merchandise inventory (baskets) from Bonnies Baskets on account. |
| 5/13/16 | Ck #1006 | Ms. Cooper received and paid the $800 charge from her lawyer. |
| 5/14/16 |
| Courtneys Cookie Bouquet 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% sales tax. Wholesale customers are not charged a sales tax in the state of Texas. Ms. Cooper will allow major customers to put their purchases on account. |
| 5/14/16 |
| Purchased $300 of supplies consisting of cellophane, ribbon and sticks to use in baskets on account. |
| 5/14/16 | Ck #1007 | Purchased shipping supplies of $400 for cash. |
| 5/14/16 |
| Sold cookies to UTEP for Graduation Ceremonies for $4,000. The cost of the cookies is $1,700; the cost of the baskets is $500, supplies $50. UTEP does not have to pay sales tax on this purchase and they paid on account. |
| 5/16/16 |
| Purchased additional cookies on account for $5,500. |
| 5/20/16 | Deposit #3 | Recorded internet sales for the first five days of operation. Sales totaled $6,000. The sales tax collected totaled $480. The $6,480 was deposited in the bank. The cost of merchandise sold was $4,200 (cookies were $3,900; baskets $300). |
| 5/22/16 | Ck #1008 | Received and paid the $300 invoice for supplies (cellophane and ribbon) purchased on 5/14/16. |
| 5/23/16 |
| Ms. Cooper donated a cookie arrangement 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 cookies were $600 and the baskets were $100. Ms. Cooper considers this an advertising expense. |
| 5/23/16 | Deposit #4 | Received payment in full from UTEP. The payment was deposited in the bank. |
| 5/23/16 | Ck #1009 | Ms. Cooper paid her credit card bill for the month. The total was $350. $300 was for gas and $50 was for the decorative ribbon used in the Humane Society arrangement. |
| 5/23/16 | Ck #1010 | Paid for the baskets purchased from Bonnies Baskets on 5/08/16. |
| 5/23/16 | Deposit #5 | Internet and retail sales totaled $7,000 plus sales taxes of $560. The cost of the merchandise sold was $4,500 (cookies $3,500; baskets $1,000). The money was deposited in the bank. |
| 5/23/16 | Ck #1011 | Paid the balance due to Courtneys Cookies for the cookies. There are two invoices on 5/8/16 and 5/16/16. The Cost of the Merchandise Sold is $1,900 (cookies $1680, baskets $220) |
| 5/25/16 | Deposit #6 | Collected and deposited $2,484 of payments on account from retail credit customers of which $184 was sales tax. |
| 5/28/16 |
| Received but did not pay the phone bill for the month, $120. |
| 5/31/16 | Ck #1012 | Paid the first monthly installment on the computer equipment. The payment amount is $318. Of this amount, $18 is for interest and $300 is for principal on the note payable. Make the check payable to Office Mart. |
| 5/31/16 |
| Purchased cookies on account for $3,400. |
| 5/31/16 | Ck #1013 | Paid all sales tax owed for May to the Comptroller of Public Accounts. |
| 5/31/16 | Ck #1014 | Declared and paid a cash dividend of $100 to Courtney Cooper. |
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