Youka Roots is a business specializing in the production and sale of innovative utensil-friendly roots that enhance
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Youka Roots is a business specializing in the production and sale of innovative utensil-friendly roots that enhance the dining experience. These roots are designed to be used alongside utensils, providing a unique and sustainable alternative to traditional table settings. The business operates in Florida and targets college campuses to introduce its products to a young and environmentally conscious consumer base.
Business Transactions:
- Initial Investment: Invest $50,000 in the business, debiting Cash and crediting Capital.
- Purchase Raw Materials: Buy raw materials (roots) for $10,000 on credit.
- Production Costs: Incur $5,000 in production costs, paying in cash.
- Manufacturing Equipment Purchase: Acquire manufacturing equipment for $15,000, financing through a loan.
- Production and Packaging: Spend $7,000 on production and packaging, paying with a credit card.
- Sales to College Cafeteria: Sell $12,000 worth of Youka Roots to a college cafeteria on credit.
- Cash Sales at Campus Events: Generate $8,000 in revenue from cash sales at various college events.
- Utilities Payment: Pay $1,000 in utility bills for the production facility.
- Loan Repayment: Repay $3,000 of the manufacturing equipment loan.
- Employee Salaries: Pay $4,000 in salaries to employees.
- Marketing Expenses: Spend $2,500 on marketing initiatives to promote Youka Roots.
- Inventory Purchase: Purchase additional raw materials (roots) for $8,000 in cash.
- Online Sales: Make online sales of $6,000 through the company website, receiving payments through digital platforms.
- Rent Payment: Pay $2,500 in rent for the production facility.
- Returned Merchandise: Process returns of $500 from unsatisfied customers.
- Tax Payment: Settle $1,200 in business taxes.
- Bulk Purchase Discount: Receive a $1,000 discount on a bulk purchase of packaging materials.
- Partnership with Local Farmers: Establish a partnership with local farmers, paying them $3,000 for a regular supply of roots.
- Discounts to College Clubs: Offer $800 worth of Youka Roots at a discount to various college clubs.
- Insurance Payment: Pay $1,500 for business insurance coverage.
- Repair Equipment: Spend $500 to repair manufacturing equipment.
- Customer Loyalty Program: Implement a customer loyalty program, giving away $300 worth of Youka Roots as rewards.
- Interest Payment: Pay $500 in interest on the manufacturing equipment loan.
- Employee Training: Invest $2,000 in employee training programs.
- Bulk Sale to Retailer: Sell $15,000 worth of Youka Roots in bulk to a local retailer on credit.
Accounting Cycle:
- Record transactions in T-accounts.
- Transfer ending T-account balances to the Trial Balance.
- Generate the Income Statement and Balance Sheet from the Trial Balance.
Related Book For
Intermediate Accounting
ISBN: 978-0324312140
16th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
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