Marichal Company is set up as a corporation in 2010 to sell college logo sports clothing in college bookstores that it will purchase from Majestic.  As the head accountant hired, your job is to record each of the following financial transactions as journal entries [use the general journal on following pages]:

10. Jan 1: The company sells 10,000 of $1 par common stock for $80,000 to start the company.  

11. Jan 1: The company finds office/warehouse space and prepays rent for one year, which amounts to $12,000.

12. Jan 1: The company invests $18,000 in computers that it estimates will have a useful life of 3 years, and $6,400 in office equipment that it estimates will have a useful life of 8 years.   The office equipment has a salvage value of $1,000, while the computers have no salvage value.  The company pays for all of the fixed assets with a three-year balloon note at 9%, with interest payable every 3 months.

13. Jan 5: The company buys $25,000 in inventory from Majestic on account.

14. Jan 25: The company pays its account with Majestic in full.

15. Jan 31: The company records sales of $27,000 for January, its first month of operations.  The cost of the inventory it sold was $19,000.  All of the sales were sold on account except for $3,800 in cash sales.

16. Jan 31: The company accrues salary expense as of the end of January.  Payroll is paid on the 1st of each month.  The monthly payroll (ignore payroll taxes) amounts to $6,000.

17. Jan 31: The company accrues interest incurred on the note for January.

18. Jan 31:  The company records depreciation expense for January (rounded to the nearest dollar).

19. Jan 31: Record the entry to close out the January revenue and expense items to retained earnings.