In this section, marks are indicated for each question.$$ There are $30$ marks in total.

Matrimonial Bliss Guaranteed $($MBG$)$ is your own business. You are a wedding planner and marriage counselor.

You work from a rented office and drive your own car to clients, banquet halls, and so on$.$

You use your own cell phone to speak with your clients and other facilities.

Your first month's transactions are listed below.

July $1$You set up a business bank account and acquire a business credit card.$$

The bank will charge a fee of $$16$ at the end of each month.$$July $2$You borrow $$2,500$ from the bank.July $3$You deposit $$3,000$ of your own money into the business bank account.July $4$You rent an office for the next four months for $$400$ per month, paying

the full amount now.July $5$You register your business name for $$60$ with Service Ontario,

using the business credit card.July $6$You purchase, using your business credit card, supplies for $$500$ plus HST$.$July $7$You purchase, using your business credit card,a computer and colour printer

for $$1,500$ from Better Buy. HST is already included.July $8$You buy a one$-$year liability insurance policy for $$2,400,$ plus $8\%$ tax,

paying cash.July $10$You purchase for $$200$ cash, plus HST$,150$ colour flyers to advertise

your business.$$ You haven't used any yet.July $11$You pay a student $$75$ cash to distribute all your flyers.July $12$You gave a quotation to a prospective engaged couple, to see if they liked it $.$

You would normally have asked for a $$100$ deposit but you give it for free.July $15$Two more couples hire you to plan their weddings.$$ You will charge them

each $$5,000$ when you provide the service in the future.$$ They EACH pay

a deposit of $$1,000$ cash.$$ Weddings are expensive!July $27$Business is wonderful!$$ You have so far collected $$20,000$ in cash

from happy$$ couples who's weddings have happened already.July $28$You now have only $$250$ worth of supplies left.July $31$One month's rent on your garage has expired.July $31$You received your cell phone bill for the month.$$ Of the $$80,$

three$-$quarters was business calls.$$ The business will pay you next month.July $31$One month of your insurance policy has expired.July $31$The bank takes its monthly charge from the business bank account,

plus an additional $$12$ for interest on the loan.July $31$One of your July $15$ customers got married today. They will pay their

balance next week. The other customer's wedding is next weekend.July $31$You pay three$-$fifths $($i$.$e$.60\%)$ of the balance owing on your business

credit card. You will pay the rest next month.

REQUIRED $-$ Use the above information to answer all of the following questions.

How will MBG record the July $1$ transaction? $(1$ mark$)$

a$.$ No entry is needed.

b$.$ decrease Cash and increase Bank Loan Payable, $$16$

c$.$decrease Cash and increase Accounts Payable, $$16$

d$.$ increase both Cash and Owner's Capital, $$16$

Enter the letter that corresponds to your choice. $($A B C D$)$

How will MBG record the July $2$ transaction? $(1$ mark$)$

a$.$ increase both Cash and Accounts Payable, $$2,500$

b$.$ increase both Cash and Bank Loan Payable, $$2,500$

c$.$ increase both Cash and Owner's Capital, $$2,500$

d$.$ increase both Cash and Revenue, $$2,500$

e$.$ increase both Cash and Retained Earnings, $$2,500$

Enter the letter that corresponds to your choice. $($A B C D E$)$

How will MBG record the July $3$ transaction? $(1$ mark$)$

a$.$ increase both Cash and Accounts Payable, $$3,000$

b$.$ increase both Cash and Bank Loan Payable, $$3,000$

c$.$ increase both Cash and Owner's Capital, $$3,000$

d$.$ increase both Cash and Revenue, $$3,000$

e$.$ increase both Cash and Retained Earnings, $$3,000$

Enter the letter that corresponds to your choice. $($A B C D E$)$

How will MBG record the July $4$ transaction? $(1$ mark$)$

a$.$ decrease Cash $$1,600$ and increase Rent Expense $$1,600$

b$.$ decrease Cash $$400$ and increase Rent Expense $$400$

c$.$ decrease Cash $$1,600$ and increase Prepaid Rent $$1,600$

d$.$ decrease Cash $$1,600,$ increase Rent Expense $$1,600$

e$.$ no entry is required.

Enter the letter that corresponds to your choice. $($A B C D E$)$