Question

ookie Creations 3 n November 2017, after having incorporated Cookle Creations Inc., Natalie begins operations. She has decided not to pursue the offer to supply cookies to Biscuits. Instead, she will cus on offering cooking dasses. The following events occur. Nov. 8 Natalie cashes in her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account. 8 Natalie opens a bank account for Cookie Creations Inc. 8 Natalie purchases $500 of Cookie Creations' common stock 11 Cookie Creations purchases paper and other office supplies for $95. (Use Supplies.) 14 Cookie Creations pays $125 to purchase baking supplies, such as flour, sugar, butter, and chocolate chips. (Use Supples.) 15 Natalie starts to gather some baking equipment to take with her when teaching the cookie classes. She has an excellent top-of-the-line food processor and mixer that originally cost her $550. Natalie decides to start using it only in her new business, She estimates that the equipment is currently worth $300, and she transfers the equipment into the business in exchange for additional common stocdk 1 The con any needs more cash to sustain its operations Natalie sgra dr other lends the company$2,000 cash ange f at year, 9% ote payable trte tand nex the principal are repayable at maturity 17 Cookie Creations pays $900 for additional baking equipment 18 Natalie schedules her first dass for November 29, She will receive $100 on the date of the class 25 Natalie books a second dass for December 5 for $150. She receives a $60 cash down payment, in advance. 29 Natalie teaches her first class, booked on November 18, and collects the $100 cash. 30 Natalie's brother develops a website for Cookie Creations Inc. that the company will use for advertising. He charges the company $600 for his work, payable at the end of December. (Because the website is expected to have a useful life of two years before upgrades are needed, it should be treated as an asset called Website) Cookie Creations pays $1,200 for a one-year insurance policy 30 30 Natalie teaches a group of elementary school students how to make Santa Claus cookies At the end of the class, Natalie leaves an invoice for $300 with the school principal. The principal says that he will pass it along to the business office and it will be paid some time in December 0 Natalie receives a $50 involce for use of her cell phone. She uses the cell phone exclusively for Cookle Creations Inc. business. The involice is for services provided in November, and payment is due on December 15 03 PM 2/2019 o search 5 8

Answer 1

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Date	Account	Debit	Credit
Nov 8	No Entry	$              -
Nov 8	No Entry		$              -
	(Natalie deposits the cash on her personal bank account)
Nov 8	No Entry	$              -
Nov 8	No Entry		$              -
	(Natalie opens a bank account)
Nov 8	Cash	$           500
Nov 8	Common Stock		$           500
	(issue common stock)
Nov 11	Supplies	$             95
Nov 11	Cash		$             95
	(purchases office and paper supplies)
Nov 14	Supplies	$           125
Nov 14	Cash		$           125
	(purchase of baking supplis)
Nov 15	Equipment	$           300
Nov 15	Common Stock		$           300
	(Natalie brought her equipment in business)
Nov 16	Cash	$        2,000
Nov 16	Note Payable		$        2,000
	(money being borrowed)
Nov 17	Equipment	$           900
Nov 17	Cash		$           900
	(being additional equipment purchased)
Nov 18	No Entry	$              -
Nov 18	No Entry		$              -
	(Natalie schedules her first class on 29th Nov)
Nov 25	Cash	$             60
Nov 25	Unearned Service Revenue		$             60
	(Cash advance received for Dec 5 class)
Nov 29	Cash	$           100
Nov 29	Service Revenue		$           100
	(Class held and received cash)
Nov 30	Website	$           600
Nov 30	Accounts Payable		$           600
	(being websited got developed, payment is due at end of December)
Nov 30	Prepaid Insurance	$        1,200
Nov 30	Cash		$        1,200
	(being amount paid for one year insurance policy)
Nov 30	Accounts Receivable	$           300
Nov 30	Service Revenue		$           300
	(class taken on credit)
Nov 30	Utility Expense	$             50
Nov 30	Accounts Payable		$             50
	(being invoice for phone recorded)

Cash
Debit		Credit
Nov 8	$       500	Nov 11	$         95
Nov 16	$    2,000	Nov 14	$       125
Nov 25	$         60	Nov 17	$       900
Nov 29	$       100	Nov 30	$    1,200
Ending Balance	$       340
Accounts Receivable
Debit		Credit
Nov 30	$       300
Ending Balance	$       300
Supplies
Debit		Credit
Nov 11	$         95
Nov 14	$       125
Ending Balance	$       220
Prepaid Insurance
Debit		Credit
Nov 30	$    1,200
Ending Balance	$    1,200
Equipment
Debit		Credit
Nov 15	$       300
Nov 17	$       900
Ending Balance	$    1,200
Website
Debit		Credit
Nov 30	$       600
Ending Balance	$       600
Accounts Payable
Debit		Credit
		Nov 30	$       600
		Nov 30	$         50
		Ending Balance	$       650
Unearned Service Revenue
Debit		Credit
		Nov 25	$         60
		Ending Balance	$         60
Note Payable
Debit		Credit
		Nov 16	$    2,000
		Ending Balance	$    2,000
Common Stock
Debit		Credit
		Nov 8	$       500
		Nov 15	$       300
		Ending Balance	$       800
Service Revenue
Debit		Credit
		Nov 29	$       100
		Nov 30	$       300
		Ending Balance	$       400
Utility Expense
Debit		Credit
Nov 30	$         50
Ending Balance	$         50