THIS IS TO BE DONE ON QUICKBOOKS: give company an opening balance of $100,000 ca

Question

THIS IS TO BE DONE ON QUICKBOOKS: give company an opening balance of $100,000 cash and equity. It is up to you to create the correct accounts, with the proper journal entries Important to remember: Do not forget to click on ‘save and new’ after you input and file. Backup your company information many times as you work. To do this, click the button at the bottom of each screen called: save and new Always check to be sure your input dates are correct. Transaction input date are on the top left side above the journal entryAlways best to record terms within the journal entry in the extra line provided to the right of A/R or A/P Always best to record terms within the journal entry in the extra line provided to the right of A/R or A/P 2. Prepare journal entries. Be sure all dates agree with the problem and are not today’s date AUG 1, 2015 – Purchased T-shirts (BI= 0, other assets, inventory) from Arotek. Bought 1950 shirts at $3.846 each. Round to nearest dollar. Arotek, vendor, terms are 1/10, n/30. AUG 4, 2015 – At Arotek’s request, Pit Bull Sings paid $200 cash to Sheng Freight for freight expenses on the August 1. AUG 5, 2015 – Sold merchandise to Lair Corp. 1040 T-shirts at $5.00 each. Lair Corporation, customer, is given credit terms to 2/10, n/60, FOB destination. The merchandise had cost of $3.846. Round to nearest dollar. AUG 8, 2015 – Purchased Specialized T-shirts from Waters Corporation. Bought 1000 shirts at $4.50 each. Waters Corporation, vendor, terms are 1/10, n/45. AUG 9, 2015- Pay Arotek Company for the shirts purchased on AUG 1. Round to nearest dollar.

Explanation / Answer

DATE ACCOUNT TITLE DEBIT CREDIT AUG 1, 2015 MERCHANDISE INVENTORY (1950 * $3.846) $7500 ACCOUNTS PAYABLE $7500 (PURCGASE OF T-SHIRTS ON ACCOUNT) AUG 4 , 2015 FREIGHT EXPENSES $200 CASH $200 (CASH PAID FOR FREIGHT EXPENSES) AUG 5 , 2015 SALES REVENUE (1040 * $5) $5200 COST OF GOODS SOLD (1040 * $3.846) $4000 ACCOUNTS RECEIVABLE $5200 MERCHANDISE INVENTORY $4000 (SALE OF MERCHANDISE INVENTORY ON ACCOUNT) AUG 8 , 2015 MERCHANDISE INVENTORY (1000 * $4.50) $4500 ACCOUNYS PAYABLE $4500 (PURCHASE OF SPECIALISED T-SHIRTS) AUG 9 ,2015 ACCOUNTS PAYABLE $7500 DISCOUNT INCOME ($7500 * 1%) $75 CASH $7425 (CASH PAID FOR AUG 1 PURCHASE AND EARNNED DISCOUNT)

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