Sweet Dreams Chocolatiers Ltd. began operations on January 1, 2020. During its first year, the following transactions occurred: 1. Issued common shares for $200,000 cash. 2. Purchased $ 483,000 of inventory on account. 3. Sold inventory on account for $646,000. The original cost of the inventory that was sold was $388,000. 4. Collected $ 554,000 from customers on account. 5. Paid $398,000 to suppliers for the inventory previously purchased on account. 6. Bought a delivery vehicle for $ 33,000 cash. 7. Paid $ 27,300 for rent, including $2,100 related to the next year. 8. Incurred $ 28,000 of operating expenses, of which $ 26,000 was paid. 9. Recorded $2,300 of depreciation on the vehicle. 10. Declared and paid dividends of $ 9,000. Prepare journal entries to record each of the above transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) No. Account Titles and Explanation Debit Credit 1. cash account $200000 to share capital account $200000 2. purchase accounts $475000 to creditors account $475000 3. debtors account $640000 to sales account $640000 (To record sale of goods) (To record the cost) 4. cash account $580000 to debtors account $580000 5. creditors account $430000 to cash $430000 6. vehicle account $36000 to cash $36000 7. rent account $24000 prepaid rent account $2000 to cash $26000 8. Operating Expense $20000 to cash $18000 to expense payable $2000 9. depreciation account $2000 to vehicle account $2000 10. dividend account $6000 to cash $6000 Post the journal entries to the following Taccounts. (Post entries in the order of journal entries presented in the previous question. If beginning balance is zero, enter in the column for the normal balance for that account.) Cash Bal. $200000 Bal. $430000 1. $580000 1 $36000 2 $24000 3. $2000 4. V $18000 5. $6000 Bal. $780000 Bal. $780000 Accounts Receivable Bal. Bal. $200000 1 $200000 Bal. $200000 Bal. $200000 Prepaid Rent Bal. $475000 1. $475000 Bal. $475000 $475000 Inventory Vehicles II III Accumulated Depreciation, Vehicles Accounts Payable IMAGE INI DILI LII Common Shares Dividends Declared Sales Revenue HIN III LUI OUI Cost of Goods Sold Rent Expense Operating Expense III DIN LUO Depreciation Expense ITI Prepare a December 31, 2020, trial balance. (Do not list those accounts that have zero ending balance.) Sweet Dreams Chocolatiers Ltd. Trial Balance December 31, 2020 Debit Credit cash $ 264000 $ share capital 200000 purchase 475000 creditors 45000 sales 640000 debtors 60000 vehicle 34000 prepaid rent 2000 rent 24000 Operating Expense 20000 expense payable 2000 depreciation 2000 dividend 6000 Totals $ 887000 887000
