Question

1. The Accounting Cycle - During the period (8pts): Following is a complete list of accounts and account balances that appear in the general ledger as of August 1, 2020 for Flourish and Botts, Co. bookstore. Assume all accounts have their normal debit or credit balance.

Account:	Amount:		Account:	Amount:
Cash	$9,021		Common Stock	$84
Accounts Receivable (A/R)	$13,992		Additional Paid-In Capital	$6,408
Inventory	$4,033		Retained Earnings	$7,220
Prepaid Rent	$200		Sales Revenue	$0
Equipment	$7,200		Cost of Goods Sold	$0
Accumulated Depreciation-Equipment	$800		Wages Expense	$0
Accounts Payable (A/P)	$11,844		Interest Expense	$0
Deferred Revenue	$3,055		Depreciation Expense	$0
Interest Payable	$35		Rent Expense	$0
Notes Payable	$5,000

The following transactions were observed for August 2020:

Date:	Transaction:
8/3	Purchased merchandise inventory on account for $11,941
8/6	Sold merchandise inventory, which originally cost $13,088, to customers for $20,972. Customers paid $2,400 in cash, the remaining $18,572 was purchased by customers on account.
8/16	Paid $2,750 in cash to workers for work done in August.
8/20	Received $17,046 in cash payments from customers on their accounts receivable.
8/27	Paid creditors $14,635 in cash for accounts payable.

PART A (4pts): Record all of the above transactions that occurred during the period using journal entries. Make sure to use proper formatting for all entries, and to include the date of each entry and a brief description of each entry. Do not make any end of the period adjusting or closing entries.

PART B (4pts): After recording the above transactions, calculate the ending balance that would appear on the August 31, 2020 unadjusted trial balance for Flourish and Botts for the following accounts. You must show your work, such as a formula or T-account used to arrive at your answer:

1. Cash
2. A/R
3. Inventory
4. A/P

Answer 1

Flourish and Botts, Co. bookstore Journal entries Date Account Debit Credit 3-Aug Inventory $ 11,941 Accounts Payable $ 11,941 Purchased merchandise inventory on account 6-Aug Cash $ 2,400 Accounts Receivable $ 18,572 Sales Revenue $ 20,972 Cost of Goods Sold $ 13,088 Inventory $ 13,088 Sold merchandise inventory in cash and on account $ 2,750 16-Aug Wages Expense Cash Paid wages to workers $ 2,750 20-Aug Cash $ 17,046 Accounts Receivable Received cash payments from customers $ 17,046 $ 14,635 27-Aug Accounts Payable Cash Paid creditors in cash $ 14,635

Date Date Flourish and Botts, Co. bookstore T Accounts Date Debit Credit Cash Op bal $ 9,021 6-Aug $ 2,400 16-Aug $ 2,750 20-Aug $ 17,046 27-Aug $ 14,635 Date Debit Date Credit Accounts Receivable Op bal $ 13,992 6-Aug $ 18,572 20-Aug $ 17,046 Date Debit Credit Inventory Op bal $ 4,033 3-Aug $ 11,941 6-Aug $ 13,088 Bal. $ 15,518 Bal. $ 2,886 Bal. $ 11,082 Accounts Payable Op bal $ 11,844 27-Aug $ 14,635 3-Aug $ 11,941 Bal. $ 9,150

Flourish and Botts, Co. bookstore Account Names Cash Accounts Receivable Inventory Accounts Payable Unadjusted TB Debit Credit 11,082 15,518 2,886 9,150

Full T accounts for reference:-