Question

Barbara Jones opened Barb's Book Business on February 1. You have been hired to maintain the company's financial records. The following transactions occurred in February, the first month of operations a Received shareholders' cash contributions on February 1 totaling $24,000 to form the corporation, issued 1,000 shares of common stock b. Paid $3180 cash on February 2 for three months' rent for office space TIP For convenience, simply record the full amount of the payment as an asset (Prepaid Rent). At the end of the month, this account will be adjusted to its proper balance c. Purchased and received supplies on February 3 for $315 cash. d. Signed a promissory note on February 4. payable in two years: deposited $17.200 in the company's bank account e On February 5, paid cash to buy equipment for $5,350 and land for $11.850 Placed an advertisement in the local paper on February 6 for $675 cash. g Recorded sales on February 7 totaling $2.550, $1,820 was in cash and the rest on accounts receivable h Collected accounts receivable of $90 from customers on February 8 On February 9, repaired one of the computers for $132 cash TIP. Most repairs involve costs that do not provide additional future economic benefits Incurred and paid employee wages on February 28 of $475.

Answer 1

Toumal entries Dale Feb. 1(a) cash To common stock Debits) Gedeta 24000 24000 Feb 2(b) pepaid Rent 3,180 To cash 3180 315 315 Dv17,200 17, 200 Feba (o cash supplies To stepphes cash Feb 4 (& Rank al -_Do Notes Payable | Feb.sce Equipment - To cash Febolf Advertisement To cash 5350 1,850 Land : 200 1675 Feb7 G cash Account Receivable To sale 1820 720 2550 Febsch cash TO Account leivable 90 #32 Febq (1) Repairs To cash 132 Feb 28 wages TO cash 475

28 Net Income and Net profit margin is calculaled below: 2550 1675 Sales Revenue ress operating expenses Advertisement Repairs wages Preliminary Met Income I Net profit margin- 132) 1268 $1268 T5 25x1ool 49.737