Use the following TRANSACTIONS AND ADDITIONAL INFORMATION to complete the General Journal, Ledger, Worksheet and Financial Statements for the last month of operations for Desert Fitness. Use the Perpetual Inventory method for all sales of merchandise. (See the last page for a detailed example of how the Perpetual Method is recorded and used).

TRANSACTIONS

Dec 1 At the beginning of December, the two principal owners invested an additional $80,000 each in exchange for shares of stock in preparation to expand their operations in the near future. The shares were trading at $5/share on December 1st.

Dec 1 Purchased land for $70,000 to be used for a new gym facility with construction planned for 2021. Desert paid 20% down and signed a 9-month, 6% note for the balance. Principal and interest is to be paid at maturity on August 31, 2020. - 3360 int = 373.33/ month

Dec 1 The Company purchased additional equipment for $164,800, paying 25% down and giving a one-year, 6% note for the balance, with principal & interest payable at maturity. - 7416 int = 618/month

Dec 1 Employees are paid on the 1st and 15th of each month. Paid the balance of what was owed at November 30, 2019.

Dec 1 Sold a piece of equipment for $5,420 cash proceeds. The equipment had an original cost of $24,000 and a 10% salvage value. All equipment is depreciated on a straight-line basis. The equipment was 80% depreciated on the date of the disposal.

Dec 2 Purchased on account a total of 320 t-shirts and tanks with a silk-screened Desert logo from T-Shirt Creations at a price of $8 per shirt. These shirts are available for resale to customers.

Dec 2 Received a bill for $2,550 from Deserts attorney for legal services rendered, to be paid by January 2, 2020.

Dec 4 Purchased office supplies for $750 on account from Max Office Supplies. The Company has 30 days to pay for the supplies.

Dec 5 During the first week of December, sold eighty, six-month memberships for an introductory price of $180 each. All membership fees were collected in cash. 30/ month

Dec 5 Sold twenty t-shirts to a corporate member, Allen & Associates for $20 each. Collected $100 in cash and the balance was charged to the customers account. The original cost of the apparel was $160.

Dec 7 During the first week of December, provided 210 hours of personal training services to members. Fees are charged at a rate of $20/hour. Of these fees, $700 was collected in cash and the balance was billed to individual members accounts.- 2100

Dec 15 For the first half of December, provided a variety of group exercise programs. Each member is charged $10/class and 720 members participated during this time. Billed the individual members accounts for services provided. 4320

Dec 15 Paid wages to employees of $10,200 and salaries to officers of $15,000; associated payroll taxes on these wages & salaries are $2,041. (You can record in two separate journal entries. Payroll taxes are an expense to the company for unemployment benefits and recorded as a payable to the state and federal taxing authority on a quarterly basis. They will be paid on Jan 1)

Dec 15 Sold fifty, six-month memberships for $180 each. Collected the fees in cash. 30/month

Dec 18 Paid the total amounts due to T-Shirt Creations, the Companys attorney and Max Office Supplies. (record as one journal entry)

Dec 21 Through the first three weeks in December, sold apparel to members for a retail selling price of $3,800. The original cost of the merchandise sold was $2,120. Collected 40% in cash, the balance was billed to each customers account. - 2280

Dec 22 Desert declared a cash dividend of $0.20 per share, payable January 30, 2020.

Dec 26 Collected the balance of what was owed on account from Allen & Associates. Also collected 40% of the fees for group exercise classes & personal training services billed to customers accounts during the first half of December.

Dec 27 Received a utility bill that totaled $1,750 for the month and a telephone bill for $356. Both were paid.

Dec 31 Desert Fitness provided you with the following information regarding the remaining activities for the month of December:

1. Fees for group classes for the last half of December

(billed to members accounts) $ 8,700

2. Fees for personal training sessions completed

during December (60% collected in cash) 4,900

3. Cash sales of apparel (original cost of apparel was

$840) 1,600

4. Credit sales for apparel during the

last half of December. 2,840

Cost of apparel sold from Dec. 16-30 1,436

5. Cash received during Dec. for services previously

billed to members accounts. 52,950

6. Of the amounts owed to suppliers on account, $12,400

Represent repairs that were made to the heating & cooling

System of the gym in November. This account was paid. 12,400

7. Desert was notified that one of their corporate account

Members had declared bankruptcy. Desert wrote off

The account. $ 2,170