Excel Case #1 Orville T. Jaden, a self-proclaimed aficionado of all things relat
ID: 2728500 • Letter: E
Question
Excel Case #1
Orville T. Jaden, a self-proclaimed aficionado of all things relating to the sandwich, opened TJ’s Sandwich Shop in Springville, USA on March 1, 2014. The shop specializes in a variety of gourmet sandwiches and a line of gourmet potato chips. Congratulations! You have been hired as the manager. Your duties include maintaining the store's financial records. The following transactions occurred in March 2014, the first month of operations.
A. Received four shareholders' contributions totaling $50,000 cash to form the corporation; issued 400 shares of $1 par value common stock.
B. Paid three months' rent for the store at $2,000 per month (recorded as prepaid rent).
C. Purchased and received deli meats and cheese for $5,000 on account, due in 60 days.
D. Purchased supplies for $1,000 cash.
E. Negotiated and signed a two-year $15,000 loan at the bank, receiving cash at the time.
F. Used the money from (e) to purchase a computer for $2,500 (for recordkeeping and inventory tracking); used the balance for furniture and fixtures for the store.
G. Placed a grand opening advertisement in the local paper for $400 cash; the ad ran in the current month.
H. Made sales during the grand opening week totaling $3,000; $2,000 was in cash and the rest on accounts receivable. The cost of the deli meats and cheese sold was $1,000.
I. Made a $600 payment on accounts payable.
J. Incurred and paid employee wages of $1,900.
K. Collected accounts receivable of $800 from customers.
L. Made a repair to one of the display cases for $300 cash.
M. Made cash sales of $3,000 during the rest of the month. The cost of the deli meat and cheese sold was $1,000.
Using the Excel templates provided, the following are required:
1. Set up appropriate T-accounts for Cash, Accounts Receivable, Supplies, Inventory, Prepaid Expenses, Equipment, Furniture and Fixtures, Accounts Payable, Notes Payable, Common Stock, Additional Paid-in Capital, Sales Revenue, Cost of Goods Sold (expense), Advertising Expense, Wage Expense, and Repair Expense. All accounts begin with zero balances.
2. Record in the T-accounts the effects of each transaction for TJ’s Sandwich Shop in March, referencing each transaction in the accounts with the transaction letter. Show the ending balances in the T-accounts. Note that transactions (h) and (m) require two types of entries, one for revenue recognition and one for the expense.
3. Prepare an income statement at the end of the month ended March 31, 2014. Be sure to update the heading and format to the Income Statement template.
4. Either in Word or as a text box in Excel, write a short memo to Orville offering your opinion on the results of operations during the first month of business.
Explanation / Answer
Cash a/c Paticulars Amount Paticulars Amount To Common Stock a/c 400 By Prepaid Rent 6000 To Additional Paid-in Capital 49600 By Supplies 1000 To Notes Payable 15000 By Advertising Expense 400 To Sales 2000 By Accounts Payable 600 To Accounts Receivable 800 By Wage Expense 1900 To Sales 3000 By Repair Expense 300 By Balance c/d 60600 70800 70800 Accounts Receivable a/c Paticulars Amount Paticulars Amount To Sales 1000 By Cash 800 By Balance c/d 200 1000 1000 Supplies a/c Paticulars Amount Paticulars Amount To Cash a/c 1000 By Balance c/d 1000 1000 1000 Inventory a/c Paticulars Amount Paticulars Amount To Accounts Payable 5000 By Cost of Goods Sold (Expense) 1000 By Cost of Goods Sold (Expense) 1000 By Balance c/d 3000 5000 5000 Prepaid Expenses a/c Paticulars Amount Paticulars Amount To Cash 6000 By Balance c/d 6000 6000 6000 Equipment a/c Paticulars Amount Paticulars Amount To Cash 2500 By Balance c/d 2500 2500 2500 Furniture and Fixtures a/c Paticulars Amount Paticulars Amount To Cash 12500 By Balance c/d 12500 12500 12500 Accounts Payable a/c Paticulars Amount Paticulars Amount To Cash 600 By Inventory 5000 To Balance c/d 4400 5000 5000 Notes Payable a/c Paticulars Amount Paticulars Amount To Balance c/d 15000 By Cash 15000 15000 15000 Common Stock a/c Paticulars Amount Paticulars Amount To Balance c/d 400 By Cash a/c 400 400 400 Additional Paid-in Capital a/c Paticulars Amount Paticulars Amount To Balance c/d 49600 By Cash a/c 49600 49600 49600 Sales Revenue a/c Paticulars Amount Paticulars Amount To Profit & Loss a/c 6000 By Cash 2000 By Accounts Receivable 1000 By Cash 3000 6000 6000 Cost of Goods Sold (Expense) a/c Paticulars Amount Paticulars Amount TO Inventory 1000 By Profit & Loss a/c 2000 TO Inventory 1000 2000 2000 Advertising Expense a/c Paticulars Amount Paticulars Amount To Cash 400 By Profit & Loss a/c 400 400 400 Wage Expense a/c Paticulars Amount Paticulars Amount To Wage Expense 1900 By Profit & Loss a/c 1900 1900 1900 Repair Expense a/c Paticulars Amount Paticulars Amount To Cash 300 By Profit & Loss a/c 300 300 300 Income Statement Paticulars Amount Paticulars Amount To Cost of Goods Sold 2000 By Sales 6000 To Gross Profit 7000 By Inventory 3000 9000 9000 To Adertising Expense 400 By Gross Profit 7000 To Wage Expense 1900 To Repair Expense 300 To Net Profit 4400 7000 7000
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.