Worksheet Problem - Chapters 11 and 12 Economic Events to Journalize, Post, and Draft Financial Statements DJ forms DJ's Glasses, Inc. and obtains the exclusive rights to sell Doodle glasses. Use the following economic events to prepare financial statements for the month of September. 1 9/1/19 - DJ buys 1,000 shares of common stock with a par value of $1 in his newly formed company for $30,000. 2 9/2/19 - The company sells $25,000 of 10 year bonds with a stated interest rate of 6%. Interest is payable semi- annually. The bonds were sold at face value. 9/2/19 -DJ Pays rent expense of $1,300. 3 4 9/2/19-DJ opens the inventory shipped from Doodle. It includes 165 pairs of glasses and an invoice for $66,000. The bill is due in 30 days. The company uses a 50% markup to price the glasses. 5 9/30/19 -DJ sold 120 pairs of glasses for $600 each. All sales were on account and were subject to sales tax at the rate of 8%. 9/30/19 - Record the cost of goods sold for the 120 pairs of glasses sold. 6 7 9/30/19 - The company uses the allowance for bad debt method and it estimates that bad debts will be 3% of sales. 8 9/30/19 - The company was notified that one of their customers has declared bankruptcy and they will not be able to collect the $400 the customers owes. 9 9/30/19 - The company collected $3,000 of the outstanding accounts receivable during the month. 10 9/30/19 - Interest expense must be accrued on the bonds for the month of September. 11 9/30/19 - The corporation declares a dividend of $1000 and pays the dividend to DJ as the sole shareholder. General Journal Entries for DJs Glasses Entry | Date Description (Account/Explanation) Debit Credit 9/1/19 9/2/19 9/2/19 9/2/19 9/30/19 9/30/19 9/30/19 9/30/19 9/30/19 10 9/30/19 9/30/19 Totals