Ice Cream Company started business July 1, 2013. Gremlin uses the perpetual inventory system.
Required: Using Excel, prepare general journal entries in good form for only the transactions listed below
July 1, 2013 Issued 5,000 shares of $1 par value common stock for $95,000 cash.
July 1 Rented building space, paying six month's rent of $24,000 in advance. (Use a real or permanent account for the building rent).
July 2 Received $12,000 for ice cream services to be provided each month from uly 2013 until June 2014. The services will be provided evenly throughout the year.
July 2 Issued 10% bonds, face amount of $100,000. The market rate of interest when the bonds sold was 11%. The bonds mature in 10 years and pay interest semi-annually starting on January 1, 2014. Gremlin will use the effective interest method recording the bonds at amortized cost.
July 7 Purchased ice cream on account for $2000.
July 8 Purchased supplies on account for $560. (Use a temporary or nominal account for the purchase of the supplies)
July 12 Recorded cash sales in the amount of $2,500. The ice cream sold cost $800.
July 16 Recorded sales on account of $2,600. The ice cream sold cost $675.
July 17 Paid for the ice cream purchased on the 7th and the supplies purchased on the 8th.
July 18 Purchased store equipment for $45,000. Paid $12,000 in cash and signed a 2-year non-interest bearing Note for the remainder. Gremlin is able to finance similar capital purchases at an interest rate of 8%. Interest in compounded annually on the note. The equipment has no salvage value, a 10 year life and will be depreciated using the straight line method.
July 21 Received an invoice for the month's utilities of $650. The bill is due on August 12th and will be paid then.
July 27 Received a cash payment of $2,600 for goods sold on account on July 16.
July 31 Supplies on hand were $460.
July 31 Make all necessary month end adjusting entries.