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Question II : The Water Bottle Company was incorporated on October 1, 2016. The following transactions...

Question II :

The Water Bottle Company was incorporated on October 1, 2016. The following transactions occurred during November:

Transaction Number Date

1) 1-Nov Issue additional common stock for $4500---------------------4,500

2) 1-Nov Purchase 800 water bottles @ $10 each on account------------------- 8,000

3A) 3-Nov Sell 300 water bottles @ $30 each for cash----------------------------- 9,000

3B) 3-Nov Same…. COGS entry 300 water bottles @ 10 each -----------------3,000

4A ) 10-Nov Sell 400 water bottles @ $40 each on account----------------------------------------------- 16,000

4B) 10-Nov Same…COGS entry 400 water bottles @$10 each----------- 4,000

5) 15-Nov Pay employees for work performed ($800 from October and $2400 November) ----------3,200

6) 15-Nov Pay $450 cash for advertising to be run in current month -----------------------------------------450

7A) 17-Nov Remaining goods from prepayment customer in October have been delivered (10 bottles @$30) -------------300

7B) 17-Nov Same…remaining goods from prepayment are delivered (COGS entry) ----------------------------------100

8) 27-Nov The Water Bottle Company makes a partial payment for the water bottles purchased Nov 1 - pay $500------------- 500

9) 28-Nov Pay $220 in utlities for current month use --------220

10) 30-Nov A customer paid in advance for 150 water bottles @ $30 each to be delivered in the future ---------4,500

11) 30-Nov Receive full payment from customer who bought on account on Nov 10 --------------------16,000

12) 30-Nov Pay cash dividends to your shareholders in the amount of $600. ------------------------------600

Adjusting Entries for November:

a) 30-Nov Adjust for use of prepaid rent 1 month

b) 30-Nov Adjust for use of insurance policy 1 month

c) 30-Nov Adjust for depreciation of equipment ($140 a month given)

d) 30-Nov Adjust for $1200 of salaries earned but not paid by month end

e) 30-Nov Adjust for interest on the loan 5% annual rate .

Deliverables:

Record all November transactions in the Financial Statement Impact Template

Record all November adjusting entries in the Financial Statement Impact Template

Create November Financial Statements

Record all closing entries in the Financial Statement Impact Template for November to set up for the following month .

Solutions

Expert Solution

Journal entries:
Sl no. Date Account titles and explanation Debit Credit
1 Nov 1. Cash 4500
Common stock 4500
(Issued additional shares for cash)
2 Nov 1. Merchandise inventory 8000
Accounts payable 8000
(Purchase on account)
3A Nov 3. Cash 9000
Sales revenue 9000
(Goods sold on cash)
3B Nov 3. Cost of goods sold 3000
Merchandise inventory 3000
(Cost of above sales recorded)
4A Nov 10. Accounts receivable 16000
Sales revenue 16000
(Sold goods on credit)
4B Nov 10. Cost of goods sold 4000
Merchandise inventory 4000
(Cost of above sales recorded)
5 Nov 15. Salaries payable 800
Salaries expense 2400
Cash 3200
(Salaries paid)
6 Nov 15. Advertising expense 450
Cash 450
(Cash paid for advertising)
7A Nov 17. Unearned revenue 300
Sales revenue 300
(Goods sold to prepaid customers)
7B Nov 17. Cost of goods sold 100
Merchandise inventory 100
(Cost of above sales recorded)
8 Nov 27. Accounts payable 500
Cash 500
(Paid for inventory purchased partially)
9 Nov 28. Utility expense 220
Cash 220
(Utilities paid for cash)
10 Nov 30. Cash 4500
Unearned revenue 4500
(Received advance from customer)
11 Nov 30. Cash 16000
Accounts receivable 16000
(Received from customer in full)
12 Nov 30. Cash dividend payable 600
Cash 600
(Dividend paid)
Adjusting entries:
Sl no. Date Account titles and explanation Debit Credit
a) Nov 30. Please provide October transactions
b) Nov 30. Please provide October transactions
c) Nov 30. Depreciation expense 140
Accumulated depreciation 140
(Depreciation recorded)
d) Nov 30. Salaries expense 1200
Salaries payable 1200
(salaries earned but not paid)
e) Nov 30. Please provide October transactions
Closing entries:
Please provide October transactions in order to pass closing entries

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