Continuing cookie chronicle answers chapter 4

Journal Entries (GRADED)
REQUIREMENT #1:
During its first month of operation, the Rawls Repair Corporation, which specializes in bicycle repairs,
completed the following transactions:
Oct. 1 Began business by making a deposit in a company bank account of $12,000, in exchange
for 1,200 shares of $10 par value common stock.
Oct. 1 Paid the premium on a one-year insurance policy, $1,200.
Oct. 1 Paid the current month's rent, $1,040.
Oct. 3 Purchased repair equipment from Conklin Company, $4,400. Paid $600 down and the balance was
placed on account. Payments will be $200.00 per month for nineteen months. The first payment is due 11/1.
Use the following Template for the Journal Entries from Chapter 4: Continuing Cookie Chronicle
a) Prepare journal entries to record the November transactions
NOTE: This sheet WILL be graded when you submit your assignment
General Journal
Date Description(Account Name) Debit Credit
2011 Nov. 8 Cash 500
Common Stock 500
(Issue of stock for cash)
11 Office Supplies 95
Cash 95
(Purchase of supplies)
14 Baking Supplies 125
Cash 125
(Purchase of supplies)
15 Equipment 300
Common Stock 300
(Equipment exchange for common stock)
16 Cash 2,000
Notes Payable 2,000
(To record note payable, 2-year 9% maturity)
17 Equipment 900
Cash 900
(Purchase of equipment)
25 Cash 60
Unearned Service Revenue 60
(Advance for future service)
29 Cash 100
Service Revenue 100
(Payment for services provided)
30 Website 600
Accounts Payable 600
(Received website development bill)
30 Prepaid Insurance 1,200
Cash 1,200
(Payed one year insurance policy, $100 x 12 expiration)
30 Accounts Receivable 300
Service Revenue 300
(Services performed on account)
30 Utilities Payable 50
Accounts Payable 50
(Received cell phone bill)
General Ledger (GRADED)
This Sheet will be used for Part B of Chapter 3
REQUIREMENT #2:
Post the journal entries to the following general ledger accounts and compute the account balances
NOTE: This sheet WILL be graded when you submit your assignment
Cash Notes Payable
Nov. 8 500 Nov. 11 95 Nov. 16 2,000
Nov. 16 2,000 Nov. 14 125 Nov. 30. Bal 2,000
Nov. 25 60 Nov. 17 900
Nov. 29 100 Nov. 30 1,200 Accounts Payable
Nov. 30 Bal. 340 Nov. 30 600
Nov. 30 50
Prepaid Insurance Nov. 30. Bal 650
Nov. 30 1,200
Nov. 30 Bal. 1,200 Common Stock
Nov. 8 500
Accounts Receivable Nov. 15 300
Nov. 30 300 Nov. 30. Bal 800
Nov. 30 Bal. 300
Service Revenue
Equipment Nov. 29 100
Nov. 15 300 Nov. 30 300
Nov. 17 900 Nov. 30 Bal. 400
Nov. 30 Bal 1,200
Unearned Service Revenue
Baking Supplies Nov. 25 60
Nov. 11 125 Nov. 30. Bal. 60
Nov. 30 Bal 220
Utilities
Nov. 30 50
Nov. 30 Bal. 50
Website
Nov. 30 600
Nov. 30 Bal. 600
Office Supplies
Nov. 11 95
Nov. 30 Bal 95
Trial Balance (GRADED)
Part C (Chapter 4)
NOTE: This sheet WILL be graded when you submit your assignment
Prepare a Trial Balance for November 30, 2011
Cookie Creations, Inc.
Trial Balance
November 30, 2011
Debit Credit
Cash $340
Prepaid Insurance 1,200
Accounts Receivable 300
Equipment 1,200
Supplies (baking/office) 220
Notes Payable $2,000
Accounts Payable 650
Common Stock 800
Service Revenue 400
Unearned Service Revenue 60
Utilities Expense 50
Website 600
Total $3,910 $3,910
*Remember debits MUST equal credits - if they do not, then there is an error somewhere. Double check your calculations and entries
Adjusting Entries (GRADED)
Chapter 4, Part D: Prepare and post adjusting entries for December
NOTE: This part WILL be graded when you submit your assignment to the instructorNOTE: This part WILL be graded when you submit your assignment to the instructor
General Journal General Ledger Trial Balance
General Journal Cash Service Revenue
Date Description(Account Name) Debit Credit Date Description(Account Name) Debit Credit Dec. 1 Bal. 340 Dec. 15 50 Dec. 1 Bal. 400 Debit Credit
2011 Dec. Adjusting Entries 2011 Dec. 5 Cash 90 5 90 16 600 5 150 Cash $1,340
31 Office Supplies Expense ($95 - $45) 50 Unearnd Service Revenue 60 8 300 23 1,250 23 4,000 Accounts Receivable 1,000
Office Supplies 50 (Total payment for class booked 25 Nov.) 150 9 750 23 800 31 Adj. 450 Supplies (Office & Baking) 1,470
(To record supplies used) 8 Cash 300 19 60 28 500 31 Adj. 450 Equipment 1,200
31 Depreciation Expense ($1,200 / (5 x 12) x 2) 40 Account Receivable 300 23 3,000 Dec. 31 Closing $5,450 Dec. 31 Bal. $5,450 Prepaid Insurance 1,200
Accumulated Depreciation-- 40 (Collection of payment for class 30 Nov.) Dec. 31 Bal. $1,340 Website 600
Equipment 9 Cash 750 Salaries & Wages Expense Accounts Payable --
(To record bimonthly depreciation) Unearned Service Revenue 750 Prepaid Insurance Dec. 23 800 Unearned Service Revenue $810
31 Amortization Expense ($600 / (2 x 12) x 1 ) 25 (Advance for future service Dec./Jan.) Dec. 1 Bal. 1,200 Dec. 31 Adj. 100 31 Adj. 56 Notes Payable 2,000
Website 25 15 Utilities Expense 50 Dec. 31 Bal. $1,100 Dec. 31 Bal. $856 Dec. 31 Closing $856 Common Stock 800
(To record website amortization) Cash 50 Dividends 500
31 Interest Expense ($2,000 x 9% x 1.5/12) 23 (Paid cell phone bill) Accounts Receivable Amortization Expense Service Revenue 4,550
Interest Payable 23 16 Accounts Payable 600 Dec. 1 Bal. 300 Dec. 8 300 Dec. 31 Adj. 25 Utilities Expense 50
(To record interest on notes payable) Cash 600 23 1,000 Dec. 31 Bal. $25 Dec. 31 Closing $25 Salaries and Wages Expense 800
31 Insurance Expense ($100 x 12 expiration) 100 (Paid website development bill) 31 Adj. 450 Total $8,160 $8,160
Prepaid Insurance 100 19 Cash 60 Dec. 31 Bal. $1,450 Depreciation Expense
(To record insurance expired) Unearned Service Revenue 60 Dec. 31 Adj. 40
31 Accounts Receivable 450 (Advance for future service Jan.) Baking Supplies Dec. 31 Bal. $40 Dec. 31 Closing $40
Servcie Revenue 450 23 Cash 3,000 Dec. 1 Bal. 125 Dec. 31 Adj. 1,025
(To record revenue earned) Accounts Receivable 1,000 23 1,250 Office Supplies Expense
31 Baking Supplies Expense 1,025 (Total payments for Dec. classes) 4,000 Dec. 31 Bal. $350 Dec. 31 Adj. 45
Baking Supplies 1,025 23 Baking Supplies 1,250 Dec. 31 Bal. $45 Dec. 31 Closing $50
(To record supplies used) Cash 1,250 Office Supplies
31 Utilities Expense 75 (To record supplies used) Dec. 1 Bal. 95 Dec. 31 Adj. 45 Interest Expense
Accounts Payable 75 23 Salaries & Wages Expense 800 Dec. 31 Bal. $50 Dec. 31 Adj. 23
(To record cell phone bill) Cash 800 Dec. 31 Bal. $23 Dec. 31 Closing $23
31 Salaries & Wages Expense ($8 x 7 hrs) 56 (Issued check to assistant) Equipment
Salaries & Wages Payable 56 28 Dividends 500 Dec. 1 Bal. 1,200 Insurance Expense
(To record accrued salaries) Cash 500 Dec. 31 Bal. $1,200 Dec. 31 Adj. 100
31 Unearned Service Revenue ($750 x 3/5) 450 (Paied dividend to shareholders) Dec. 31 Bal. $100 Dec. 31 Closing $100
Service Revenue 450 Website
(To record revenue earned) Dec. 1 Bal. 600 Dec. 31 Adj. 25 Utilities Expense
Dec. 31 Bal. $575 Dec. 1 Bal 50
31 Adj. 75
Accounts Payable Dec. 31 Bal. $125 Dec. 31 Closing $125
Dec. 15 50 Dec. 1 Bal. 650
Dec. 16 600 Dec. 31 Adj. 75 Baking Supplies Expense
Dec. 31 Bal. $75 Dec. 31 Adj. 1,025
Dec. 31 Bal. $1,025 Dec. 31 Closing $1,025
Unearned Service Revenue
Dec. 5 60 Dec. 1 Bal. 60 Dividends
31 Adj. 450 9 750 Dec. 28 500
19 60 Dec. 31 Bal. $500 Dec. 31 Closing $500
Dec. 31 Bal. $360
Income Summary
Notes Payable Dec. 31 Closing 2,239 Dec. 31 Closing 5,450
Dec. 1 Bal. 2,000 Dec. 31 Closing 3,211
Dec. 31 Bal. $2,000
Retained Earnings
Salaries & Wages Payable Dec. 31 Closing 500 Dec. 31 Closing 3,211
Dec. 31 Adj. 56 Dec. 31 Bal. $2,711
Dec. 31 Bal. $56
Accumulated Depreciation Equipment
Dec. 31 Adj. 40
Dec. 31 Bal. $40
Common Stock
Dec. 1 Bal. 800
Dec. 31 Bal. $800
Interest Payable
Dec. 31 Adj. 23
Dec. 31 Bal. $23
Adjusted TB (GRADED)
Chapter 4, Part E: Prepare an adjusted trial balance
Note: This part WILL be graded when you submit your assignment to the instructor
Cookie Creations Inc
Adjusted Trial Balance
December 31, 2011
Debit Credit
Cash $1,340
Accounts Receivable 1,450
Supplies (Office & Baking) 400
Prepaid Insurance 1,100
Equipment 1,200
Accumulated Depreciation--Equipment $40
Website 575
Interest Payable 23
Salaries and Wages Payable 56
Accounts Payable 75
Unearned Service Revenue 360
Notes Payable 2,000
Service Revenue 5,450
Common Stock 800
Dividends 500
Salaries and Wages Expense 856
Utilities Expense 125
Insurance Expense 100
Amortization Expense 25
Interest Expense 23
Depreciation Expense 40
Supplies Expense (Office & Baking) 1,070
Total $8,804 $8,804
Financial Statements (GRADED)
Chapter 4, Part F: Prepare financial statement
Note: This part WILL be graded when you submit your assignment to the instructor
You will only be preparing the Income Statement, Statement of Retained Earning and the Balance Sheet.
Cookie Creations Inc Cookie Creations Cookie Creations
Income Statement Statement of Retained Earnings Balance Sheet
For the Month Ending December 31, 2011 For the Month Ending December 31, 2011 December 31, 2011
Revenues: Retained Earnings, November 1 -- Current Assets
Service Revenue $5,450 Add: Net Income 3,211 Cash $1,340
Subtotal $3,211 Accounts Receivable 1,450
Operating Expenses: Less: Dividends 500 Supplies (Office & Baking) 400
Supplies Expense $1,070 Retained Earnings, December 31 $2,711 Prepaid Insurance 1,100
Salaries and Wages Expense 856 Total Current Assets $4,290
Utilities Expense 125 Property, Plant & Equipment
Insurance Expense 100 Equipment 1,200
Amortization Expense 25 Less: Accumulated Depreciation 40 1,160
Interest Expense 23 Intangible Assets
Depreciation Expense 40 Website 575
Total Operating Expenses 2,239 Total Assets $6,025
Net Income $3,211 Liabilities & Stockholder's Equity
Unearned Service Revenue 360
Accounts Payable 75
Salaries and Wages Payable 56 491
Total Current Liabilities $491
Long- Term Liabilities
Notes Payable 2,000
Interest payable 23 2,023
Total Liabilities $2,514
Stockholder's Equity
Common stock 800
Retained earning 2,711 3,511
Total Stockholder's Equity $3,511
Total Liabilities & Stockholder's Equity $6,025
*Remember, Assets and liabilities MUST be the same amount. If they are different, then there is an error somewhere. Double check your calculations and entries
Closing Entries (GRADED)
Chapter 4 - Part G: Prepare closing entries
Note: This part WILL be graded when you submit your assignment to the instructor
Hint: use the balances for each account which appear on the Adjusted Trial Balance for your closing entries.
General Journal
Date Description (Account Name) Debit Credit
2011 Dec. 31 Service Revenue 5,450
Income Summary 5,450
31 Income Summary 2, 239
Supplies Expense (Office & Baking) 1,070
Salaries and Wages Expense 856
Utilities Expense 125
Insurance Expense 100
Depreciation Expense 40
Amortization Expense 25
Interest Expense 23
31 Income Summary 3,211
Retained Earnings 3,211
31 Retained Earnings 500
Dividends 500
Post Closing TB (GRADED)
Chapter 4 - Part H: Prepare post-closing trial balance
Note: This part WILL be graded when you submit your assignment to the instructor
Cookie Creations
Post-Closing Trial Balance
December 31, 2011
Cash $1,340
Accounts Receivable 1,450
Supplies (Office & Baking) 400
Prepaid Insurance 1,100
Equipment 1,200
Accumulated Depreciation--Equipment $40
Website 575
Accounts Payable 75
Interest Payable 23
Salaries and Wages Payable 56
Unearned Service Revenue 360
Notes Payable 2,000
Common Stock 800
Retained Earnings 2,711
Total $6,065 $6,065