Becky's Awesome T-shirts (BAT) Inc. Becky's Awesome T-shirts (BAT) was established January 1, 20x0 by its sole shareholder Becky Thompson. Becky invested $50,000 of her own money in return for shares in BAT Inc. It is January 2, and you are meeting with Becky. She has asked you to help set up her accounting system for the new company. Below are notes from your meeting with Becky.

1. Becky buy plain white t-shirts from a supplier who she has already sourced out. Her plan is to then screen-print "cool" designs and sayings onto the t-shirts and sell them in her on-line store. The supplier expects payment in 30 days.

2. While Becky will not have a storefront, she will sell t-shirts to the public directly from her manufacturing facility. That is, customers can come to the manufcturing facility and purchase inventory that is in stock.

3. Becky has signed a lease that begins February 15 and lasts for one year. This lease is for a wharehouse where she will make/store/sell the t-shirts in. The lessor requires BAT to carry insurance on the premises.

4. Before beginning production, Becky will need purchase the printing equipment as well as the ink and other supplies like labels and thread.

5. Becky is also looking for 2 full-time staff to help her run the printing machines. They will help with manufacturing the t-shirts.

6. Becky is an artist and quite witty. She is custom-making all designs and graphics in house.

7. Becky has opened a bank account for BAT Inc. at the Royal Bank. Becky realizes that $50,000 won't be enough to purcahse all she needs to get up and running, and so has set up a meeting to get a loan from the bank.

8. Becky's on-line sales will be paid when ordered by customers. However, she has already spoken with a number of corporate clients who may order hundreds or even thousands of t-shirts. Obviously, these would not be paid in cash, but rather under normal credit cirucumstances of net 30 days.

9. Becky will be taking a small salary of $2,500 a month to cover her expenses.

10. Becky will need to pay the utiliities and Internet bills on the leased facilities.

Required: 

Set up a Chart of Accounts for BAT. Think of all of the accounts that could logically apply. Ignore payroll and GST/HST For each account, explain WHY you have included it. i want the specific accounts that the above 10 items would give rise to. You are going to have to do some thinking and use some common sense to figure this out. I have set up the first account for you, and shown the format I am looking for. BAT Inc. Chart of Accounts at January 1, 20x0 Account From which Name Data Point? Cash Opening Paragraph 7 BAT Inc. Chart of Accounts at January 1, 20x0 Reasoning Becky invested $50,000 cash and so we would need a Cash Account. Becky opened a bank account. This will be the "cash" account on the books.

Answer rating: 100% (QA)

Heres a Chart of Accounts for BAT Inc based on the information provided in the 10 items you mentioned Account Number Account Name Data Point Reasoning ... View the full answer