Question - Selfish Gene Company is a merchandising firm. The following events occurred during the month of May. (Note: Selfish Gene maintains a perpetual inventory system.)
May 1. Received $40,000 cash as new stockholder investment
May 3. Purchase inventory costing $8,000 on account from Dawkins Company; Term 2/10, n/30
May 4. Purchase office supplies for $500 cash.
May 4. Held an office party for the retiring accountant. Balloons, hats, and refreshments cost $150 and were paid for with office staff contributions.
May 5. Sold Mechandise costing $7,500 on account for $14,000 to Richard Company; terms 3/15, n/30.
May 8 Paid employee wages of $2,000. Gross wages were $2,450; taxes totaling $450 were withheld.
May 9. Hired a new accountant; agreed to a first-year salary of $28,000.
May 10. Received payment from Richard Company.
May 12. Purchased a machine for $6,400 cash.
May 15. Declared a cash dividend totaling $25,000.
May 18. Sold merchandise costing $13,000 for $3,000 cash and $21,000 on account to Feynman Company; Term n/30
May 19. Paid Dawkins Company account in full.
May 22. Company executives appeared on the cover of national newsmagazine. Related article extolled Selfish Gene's Labor practices, environmental concerns, and customer service.
May 23. Market Value of Selfish Gene's common stock rose by $150,000
May 25. Purchased a building for $15,000 cash and a $135,000 mortgage payable.
May 29. Paid dividend declared on May 15.
Instructions -
1. Record the preceding events in general journal form.
2. Which event do you think had the most significant economic impact on Selfish Gene Company? Are all economically relevant events recorded in the financial records?