Parker opened The Great Sandwich Shop, LLC in Hometown, USA on August 1, 2021. The shop specializes in a variety of gourmet sandwiches and also sells bottles of their special homemade sauces and salads. Congratulations! You have been hired as the General Manager. Your duties include maintaining the store's financial records. The following transactions occurred in August 2021, the first month of operations.

1. Received four shareholders' contributions totaling $10,000 cash to form the corporation; issued 400 shares of $1 par value common stock.

2. Paid two months' rent, in advance, for the store at $1,600 per month.

3. Purchased and received deli ingredients for $5,000 on account, due in 30 days.

4. Purchased supplies for $300 cash.

5. Negotiated and signed a two-year $50,000 loan at the bank, receiving cash.

6. Used the money from (e) to purchase a computer for $1,400 (for recordkeeping and inventory tracking); used the balance for furniture and fixtures for the store.

7. Placed a grand opening advertisement in the local paper for $150 cash; the ad ran in the current month.

8. Made sales during the grand opening week totaling $7,000; $3,000 was in cash and the rest on accounts receivable. Product (Cost of Goods Sold) costs were $1,500.

9. Made a $500 payment on accounts payable.

10. Incurred and paid employee wages of $2,100.

11. Collected accounts receivable of $900 from customers.

12. Made a repair to one of the display cases for $300 cash.

13. Madecashsalesof$4,000duringtherestofthemonth.Thecostofgoodssoldwas$500.

Using the Excel, the following are required:

1. Set up appropriate T-accounts for the following accounts: 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), Rent Expense, Advertising Expense, Wage Expense, and Repair Expense. All accounts begin with zero balances.

2. Record in the T-accounts the result of each transaction for The Great Sandwich Shop in August, referencing each transaction in the accounts with the transaction letter. Show the ending balances in the T-accounts. Note: transactions (b), (h) and (m) require two types of entries, one for revenue recognition and one for the expense.

3. Prepare an income statement for the month ending August 31, 2021.

4. Either in Word or as a text box in Excel, write a memo to Micah offering your opinion on the

   results of operations during the first month of business. This is more than just a great job. Consider what you would want to know as a business owner from a manager you have hired for the day to day activities. What can be improved? What seems odd for that type of business?

Answer rating: 100% (QA)

a Cash Common Stock 400 Prepaid Expenses 1600 Additional Paidin Capital 9600 Supplies 300 Notes Payable 50000 Equipment 1400 Sales Revenue 3000 Furnit... View the full answer