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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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