This problem helps you develop skill in recording transactions by using a company’s actual account titles. Refer to the Amazon.com financial statements in Appendix A. Note that large companies like Amazon.com use summary account titles in their financials, rather than listing each individual account by name. Assume that Amazon.com completed the following selected transactions during December 2009:
Dec 1 Earned sales revenue and collected cash, $60,000 (“Net sales”).
9 Borrowed $200,000 by signing a note payable (“Long-term debt”).
12 Purchased equipment on account, $10,000 (“Fixed assets”).
22 Paid half the account payable from December 12.
28 Paid electricity bill for $3,000 (“General and administrative expense”).
31 Paid $100,000 of the note payable, plus interest expense of $1,000.
Requirement
1. Journalize these transactions, using the following account headings taken from the Amazon.com financial statements: Cash and cash equivalents, Equipment, Fixed assets, Accounts payable, Long-term debt, Net sales, General and administrative expense, and Interest expense. Explanations are not required.