Required:

1. Journalize the transactions. Assume 360 days for interest calculations and record two entries for transactions on January 5th, April 1st and June 20th. Record one entry on December 1. If required, round your answers to two decimal places.

Feb.	15	Received a $2,500, 6-month, 7% note from Carol Reynolds for sale of merchandise.
Mar.	11	Morgan Hartley invested an additional $5,000 into the business.
Apr.	1	Disposed of a cash register (Store Equipment) originally costing $675 with a $75 salvage value. Depreciation is computed on a monthly basis with adjusting entries made at the end of each year. Depreciation after eight years of use was $480 as of December 31. The cash register had an estimated life of 10 years.
	12	Borrowed $5,000 from Dean Bank, signing a 75-day, 10% note.
Apr.	14	Paid $500, plus interest, to Zekir Computer Systems (see January 14) and gave a new $2,500, 30-day, 8% note to extend time for payment.
May	1	Wrote off the $1,200 balance owed by Brenda Husband as uncollectible.
	14	Paid the principal and interest due on the $2,500 note to Zekir Computer Systems. (See April 14.)
	25	Paid $75 cash to Snowdens Service Station for an oil change and tire rotation on the company van.
June	1	Received a $1,700, 120-day, 8% note from Heidi Kruczkiewicz to settle an account receivable.
	20	Reinstated the account of Brenda Husband, which had been written off last month, and received $1,200 cash in full settlement. (See May 1.)
	22	Paid $30,000 cash to Klippi Construction for an addition (Addition) to the store so that more merchandise could be displayed. The addition has an estimated salvage value of $2,000 and an estimated life of 20 years. Depreciation is to be calculated using the straight-line method.
	26	Paid the principal and interest due on the $5,000 note to Dean Bank. (See April 12.)
	30	Upon opening the store, it was apparent that someone had entered the store illegally. Jordan and Morgan need to determine whether anything had been stolen. A physical inventory was taken and it was determined that $67,500 in inventory was on hand, but they need to know how much inventory should have been on hand. Estimate the cost using the retail method based on the following information. Figures at cost: beginning inventory, $91,250; and net purchases, $70,000. Figures at retail: beginning inventory, $120,000; net purchases, $95,000; and net sales, $125,000. Compare your estimate with the balance of $67,500. Does it appear that any inventory was stolen? Space is provided for your calculations following the journal pages for the problem in your working papers.
July	1	Heidi Kruczkiewiczs note (see June 1) is discounted at Marshall Bank at a discount rate of 12%.
	8	Sold $4,250 in merchandise to Kim Sackett, terms 2/10, n/30.
	10	Purchased merchandise on account for $15,000 from Dionis Distributing. Credit terms are 3/20, n/30.
	18	Received payment in full from Kim Sackett, less discount, for merchandise sold on July 8.
	30	Paid Dionis Distributing for merchandise purchased on account on July 10.
Aug.	1	Paid $500 to Snowdens Service Station to replace the exhaust system on the company van.
	15	Received notification from Dean Bank that the principal and interest were collected on the note from Carol Reynolds. (See February 15.) The bank fee for collecting the note was $10.
	22	Wrote off the $750 balance owed by Shelley Kozub as uncollectible.
Sept.	1	Traded the company car (Automobile) for a newer one at Plume Motors. The old car originally cost $23,000 and is depreciated up-to-date in the amount of $19,000. A trade-in allowance of $5,500 was given. The new car had a market value of $40,000 and the balance was paid in cash. The new car should last at least 100,000 miles and will be depreciated at $0.375 per mile.
	9	Received a $2,000, 60-day, 7.5% note from Tammy Jones in payment of an account receivable.
	15	Purchased $3,500 worth of toys from Dennis Designs, terms n/30.
	29	Received notification from Marshall Bank that Heidi Kruczkiewiczs note was dishonored. (See June 1 and July 1.) A check is issued to cover the maturity value plus a $50 bank fee that must be paid to the bank.
Oct.	15	Issued a $3,500, 90-day, 8% note to Dennis Designs to extend time for payment on an account payable.
	20	Borrowed $10,000 for 180 days from Ohler-Cupplo Savings Association on a non-interest-bearing note. The discount rate is 7.5%.
	31	Sold $125 of merchandise for cash to Melinda Miller.
Nov.	1	Received a $500, 30-day, 5% note from Laura Nottingham in payment of an account receivable.
	8	Received notification from Marshall Bank that Tammy Jones dishonored her note. (See September 9.) No fee was charged.
	30	Heidi Kruczkiewiczs dishonored note is collected; Kruczkiewicz pays ToyMania! the maturity value of the note, the $50 bank fee, and interest at 9% on the maturity value plus bank fee. (See September 29.)
Dec.	1	Laura Nottingham paid the interest due on her note (see November 1), and gave a new note ($500) for 45 days at 8%.
	14	Paid $2,000 to landscape and improve a grassy area on the lot. There will be no salvage value after 5 years and the landscaping will be depreciated using the sum-of-the-years-digits method.
	31	Sold building fixtures for $100. The original cost of the fixtures was $500 with an estimated 5-year life and no salvage value. Depreciation up-to-date is $300.