In April 2 0 2 3 , Sarah Jones created a new business, IthacaDeep, Incorporated, offering therapeutic
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Question:
In April Sarah Jones created a new business, IthacaDeep, Incorporated, offering therapeutic deep tissue massage for stress reduction, pain management, injury recovery, and relief from muscle strains and tightness experienced by anyone, especially athletes, fitness enthusiasts, runners, and physical laborers. You have been hired to record the transactions occurring in the first month of operations.
a Received investment of cash by three organizers and issued to them a total of shares of $ par value stock with a market price of $ per share.
b Borrowed $ from a local bank, signing a note due in three years.
c Signed a oneyear lease for a space near a health club, paying $ for April rent and $ for rent for May, June, and July.
d Purchased equipment costing $ paying percent in cash and owing the rest on account to the supplier, due in days.
e Ordered a business computer and printer from Dell for $
f Loaned $ to an employee who signed a note due in three months.
g Purchased supplies for $ on account.
h Paid Facebook $ as a budget for advertising. Facebook charges the advertisers account per click, drawing down the balance. The average click is $
i Paid $ for months of insurance coverage, with onetwelfth covering April and the rest covering the remainder of the fiscal year end of March next year
j Purchased shortterm investments for $ cash.
k Along with her four other licensed massage therapists, Sarah and her team provided $ of deep tissue service to clients in April who paid half in cash and agreed to pay the rest in May.
l Paid employees $ in wages for work in April.
m At the end of April, received a $ utility bill for the use of gas and electric in April. The bill will be paid in May.
n Paid $ on the longterm note owed to the bank ignore interest
o Earned and received $ in interest on the shortterm investments.
p Sent the team to Boston in April to receive additional specialty training, costing IthacaDeep $ cash.
q Received $ from clients for a series of services to be performed beginning in May.
Required:
Prepare journal entries for each transaction.
Post the effects of the transactions to the Taccounts.
Prepare an unadjusted trial balance for IthacaDeep, Incorporated, at the end of April.
Prepare an unadjusted classified income statement, statement of stockholders equity, and classified balance sheet from the trial balance created in requirement above.
Compute the following ratios: current ratio and net profit margin ratio.
Related Book For
Financial Accounting
ISBN: 9781264229734
11th Edition
Authors: Robert Libby, Patricia Libby, Frank Hodge
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