Meredith Snelson started Campus Pizzeria, Inc. on August 1, 1998. Transactions for August are: 1. Snelson invested $5000 in the business as owner. 2. The firm paid $750 rent for the month of August. 3. On August 01, 1998, the firm borrowed $4000 from a bank on a 3% monthly note payable, with interest payable monthly and the principal to be paid in full at the end of 2 years. Interest for August was paid in cash. 4. Equipment costing $7200 was purchased for cash. The expected life of the equipment was 10 years. 5. An initial inventory of pizza ingredients and boxes was purchased on credit for $6550. 6. Pizzeria's employees were paid $3000 in wages. 7. Pizza sales for August were $12000, all for cash. 8. Sales in August consumed $6000 worth of ingredients and boxes. 9. At the end of the month, bills for various utilities totaled $450. 10. $4800 of accounts payable was paid. 11. The firm catered a party for a fee of $200. Since the customer was a friend of Snelson, the customer was told that payment could be made some time later in the month. 12. A check was received from Snelson's friend for the party that they catered. Prepare the balance sheet as of the end of August and income statement for the month of August.

Meredith Snelson started Campus Pizzeria, Inc. on August 1, 1998. Transactions for August are: 1. Snelson invested $5000 in the business as owner. 2. The firm paid $750 rent for the month of August. 3. On August 01, 1998, the firm borrowed $4000 from a bank on a 3% monthly note payable, with interest payable monthly and the principal to be paid in full at the end of 2 years. Interest for August was paid in cash. 4. Equipment costing $7200 was purchased for cash. The expected life of the equipment was 10 years. 5. An initial inventory of pizza ingredients and boxes was purchased on credit for $6550. 6. Pizzeria's employees were paid $3000 in wages. 7. Pizza sales for August were $12000, all for cash. 8. Sales in August consumed $6000 worth of ingredients and boxes. 9. At the end of the month, bills for various utilities totaled $450. 10. $4800 of accounts payable was paid. 11. The firm catered a party for a fee of $200. Since the customer was a friend of Snelson, the customer was told that payment could be made some time later in the month. 12. A check was received from Snelson's friend for the party that they catered. Prepare the balance sheet as of the end of August and income statement for the month of August.

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter1: Asset, Liability, Owner’s Equity, Revenue, And Expense Accounts

Section: Chapter Questions

Problem 4PA: On March 1 of this year, B. Gervais established Gervais Catering Service. The account headings are...

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