After researching the different forms of business organization.

After researching the different forms of business organization. Natalie Koebel decides to operate “Cookie Creations” as a proprietorship. She then starts the process of getting the business running. In November 2011, the following activities take place.

Nov. 8 Natalie cashes her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account.

8 She opens a bank account under the name “Cookie Creations” and transfers $500 from her personal account to the new account.

11 Natalie pays $65 for advertising.

13 She buys baking supplies, such as flour, sugar, butter, and chocolate chips, for $125 cash.

14 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 $750. Natalie decides to start using it only in her new business. She estimates that the equipment is currently worth $300. She invests the equipment in the business.

16 Natalie realizes that her initial cash investment is not enough. Her grandmother lends her $2,000 cash, for which Natalie signs a note payable in the name of the business. Natalie deposits the money in the business bank account.

17 She buys more baking equipment for $900 cash.

20 She teaches her first class and collects $125 cash.

25 Natalie books a second class for December 4 for $150. She receives $30 cash in advance as a down payment.

30 Natalie pays $1,320 for a one-year insurance policy that will expire on December 1, 2011.


(a) Prepare journal entries to record the November transactions.

(b) Post the journal entries to general ledger accounts.

(c) Prepare a trial balance at November 30.