Kimmel, Accounting 5th edition
CCC3 CONTINUING COOKIE CHRONICLE SOLUTION
Continuing Cookie Chronicle
(Note: This is a continuation of the Cookie Chronicle from Chapters 1 and 2.) CCC3 In November 2009 after having incorporated Cookie Creations Inc., Natalie begins operations. She has decided not to pursue the offer to supply cookies to Biscuits. Instead she will focus on offering cooking classes. The following events occur. Nov. 8 Natalie cashes in her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account. 8 Natalie opens a bank account for Cookie Creations Inc. 8 Natalie purchases $500 of Cookie Creations’ common stock. 11 Natalie designs a brochure and a poster to advertise the company and the services available. 11 Cookie Creations pays $95 to have the advertising brochures and posters printed. 14 Cookie Creations pays $125 to purchase baking supplies, such as flour, sugar, butter, and chocolate chips. 15 Natalie starts to gather some baking equipment to take with her when teaching the cookie classes. She has an excellent top-of-the-line food processor and mixer that originally cost her $550. Natalie decides to start using it only in her new business. She estimates that the equipment is currently worth $300, and she transfers the equipment into the business in exchange for additional common stock. 16 The company needs more cash to sustain its operations. Natalie’s grandmother lends the company $2,000 cash, in exchange for a two-year, 9% note payable. Interest and the principal are repayable at maturity. 17 Cookie Creations pays $900 for additional baking equipment. 18 Natalie schedules her first class for November 29. She will receive $100 on the date of the class. 25 Natalie books a second class for December 5 for $150. She receives a $60 cash down payment, in advance. 29 Natalie teaches her first class, booked on November 18, and collects the $100 cash. 30 Natalie’s brother develops a website for Cookie Creations Inc....
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