You start a cookie business and this is what you do in your first month (all...

You start a cookie business and this is what you do in your first month (all of the below occurs during month 1):

You invest $30 in your cookie business

You get a $30 loan from your parents.

You go to the grocery store to buy flour and butter. Your ingredients can make 80 cookies. Your total cost is $40. You pay $20 in cash and $20 is charged to your account at the grocery store.

Your mom makes a batch of cookies for 40 glasses and charges $2 in labor (cash).

You sell the 40 cookies at $1 each. You receive cash for 20 cookies and the other 20 cookies are purchased on account.

You repay $15 of the loan.

Your parents want $2 in interest (cash).

The fleetmarket where you sells your cookies charges to buy an insurance policy. The insurance agent offers you a ten-week policy for the summer which costs $10 payable in advance (you have to pay for the entire policy in cash now, but you only expense one week in this accounting period).

You purchase a convection oven for $25. You also buy a tiny patch of land from a friend’s family for $5. You pay for the convection oven and the land with cash. You depreciate the convection over $2/week.

A customer pays $5 for cookies bought on account

Prepare your balance sheet, Income statement and cash flows

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Expert Solution

ekkarill92 answered 1 year ago

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