The following account balances are shown on November 30, 1999, for the Clever Bookstore:

The following transactions occurred during December.

 1. Paid workers the $2,000 owed them on November 30.

 2. Made sales totaling $40,000. Half of the sales were for cash. The other half were on account. The cost of goods sold was $25,000.

3. Purchased inventory on account, $15,000.

4. Collected in cash $22,000 of receivables.

5. Used supplies totaling $800.

6. Paid accounts payable of $ 12,000.

7. Paid all December’s interest on the note payable in the amount of $300.

Required

a. Analyze all transactions using the basic accounting equation. Begin your analysis by entering the November 30 account balances into a worksheet. Then enter each of the transactions above into your worksheet.

b. Prepare a balance sheet as of December 31, 1999.

c. Prepare an income statement for the month ended December 31, 1999.

Transcribed Image Text:

Cash Accounts receivable Inventory Supplies Total $ 8,000 9,000 60,000 3,000 $80,000 Accounts payable Salaries payable Notes payable J. Clever, capital Total $4,000 2,000 35,000 39,000 $80,000 Cash Accounts receivable Inventory Supplies Total $ 8,000 9,000 60,000 3,000 $80,000 Accounts payable Salaries payable Notes payable J. Clever, capital Total $4,000 2,000 35,000 39,000 $80,000

Answer rating: 100% (QA)

Ans Transactions Cash OpngBalance a b b c d e f g Closing Balance REVENUE 8000 2000 20000 22000 1200... View the full answer