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home / study / business / accounting / accounting questions and answers / In November 2011, After Having Incorporated Cookie Creations Inc., Natalie Begins Operations. ... Your question has been answered Let us know if you got a helpful answer. Rate this answer Question: In November 2011, after having incorporated Cookie Creations Inc., Natalie begins operations. She... In November 2011, after having incorporated Cookie Creations Inc., Natalie begins operations. She has decided not to pursue the offer to supply cookies to Biscuits. Instead, she will focus on offering cooking classes. 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. Nov. 8 Natalie opens a bank account for Cookie Creations Inc. Nov. 8 Natalie purchases $500 of Cookie Creations’ common stock. Nov. 11 Cookie Creations purchases paper and other office supplies for $95. (Use Supplies.) Nov. 14 Cookie Creations pays $125 to purchase baking supplies, such as flour, sugar, butter, and chocolate chips. (Use Supplies.) Nov. 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 stock. Nov. 16 The company needs more cash to sustain its operations. Natalie’s grandmother lends the company $2,000 cash, in exchange for a two-year, 9% note payable. Interest and the principal are repayable at maturity. Nov. 17 Cookie Creations pays $900 for additional baking equipment. Nov. 18 Natalie schedules her first class for November 29. She will receive $100 on the date of the class. Nov. 25 Natalie books a second class for December 5 for $150. She receives a $60 cash down payment, in advance. Nov. 29 Natalie teaches her first class, booked on November 18, and collects the $100 cash. Nov. 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.) Nov. 30 Cookie Creations pays $1,200 for a one-year insurance policy. Nov. 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. Nov. 30 Natalie receives a $50 invoice for use of her cell phone. She uses the cell phone exclusively for Cookie Creations Inc. business. The invoice is for services provided in November, and payment is due on December 15.
Instructions: Post the journal entries to the general ledger accounts. The link below is the format
https://moodle.plattsburgh.edu/mod/resource/view.php?id=889155
Explanation / Answer
Cookie Creations (Natalie) Amounts in $ Debit Credit 08-Nov-11 Cash 520 Common Stock 520 (Encashment of Natalie's US Saving Bonds) 08-Nov-11 Bank 520 Cash 520 (Cash depposited into Natalie's bank account) 08-Nov-11 Bank 500 Common Stock 500 (Cookie Creations Common Stock purchased) 11-Nov-11 Paper and other suppies 95 Bank 95 14-Nov-11 Baking suppies 125 Bank 125 Purchase of baking supp;lies) 15-Nov-11 Baking Equipment 300 Common Stock 300 (Transfer of baking equipment in exchange for Common Stock) 16-Nov-11 Bank 2000 Note Payable (2 year 9%) 2000 (Note payable issued to grand mother) 17-Nov-11 Baking Equipment 900 Bank 900 (Purchase of additional Baking Equipment) 29-Nov-11 Bank 100 Baking Classes Income 100 (Received for class) 25-Nov-11 Bank 60 Baking Classes Income 60 (Down payment for class on Website 600 Bank 600 (Payment for website with useful life of 2 years) 30-Nov-11 Insurance 1200 Bank 1200 (One year insurance policy) 30-Nov-11 Receivables 300 Baking Classes Income 300 (Invoice for class left with school principal) 15-Dec-11 Telephone 50 Bank 50 (Telephone charges paid) General Ledger Accounts Common Stock of Cookie Creations Inc. 08-Nov-11 Cash 520 08-Nov-11 Bank 500 15-Nov-11 Baking Equipment 300 1320 Baking suppies 14-Nov-11 Bank 125 125 Baking Equipment 15-Nov-11 Common Stock 300 17-Nov-11 Bank 900 1200 Baking Classes Income 29-Nov-11 Bank 100 25-Nov-11 Bank 60 30-Nov-11 Receivables 300 460 Paper and other suppies 11-Nov-11 Bank 95 Insurance 30-Nov-11 Bank 1200 Website 25-Nov-11 Bank 600 Note Payable (2 year 9%) 16-Nov-11 Bank 2000 Telephone 15-Dec-11 Bank 50
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