Collette and Cohen incorporate as CC Designs, Inc.on January 1, Year 1.CC Designs creates custom wall finishes and sells painting products.The following transactions occur during January.
a. Cohen contributes cash of $75,000 and receives 15,000 shares of $1 par value stock.
b. Collette contributes $35,000 cash, office furniture with a value of $5,000, and computer equipment with a value of $10,000 and receives 15,000 shares of $1 par value stock. The furniture and equipment is expected to last 5 years and has no salvage value.
c. On January 2, $10,000 of painting products are purchased. CC paid $8,000 cash with the remaining amount on account.
d. During January, painting products are sold for $8,000 cash. The cost of the products is $2,000.
e. Additional painting products with a value of $5,000 are sold, with a cost of $1,500, but the cash is not collected as of January 31st. It is expected that the $5,000 will be collected in full by February 15th.
f. Cohen is paid a salary of $2,000.
g. CC paid $1,200 for January and February rent.
Required:
Prepare appropriate accrual basis journal entries.

Question

Collette and Cohen incorporate as CC Designs, Inc.on January 1, Year 1.CC Designs creates custom wall finishes and sells painting products.The following transactions occur during January.
 a. Cohen contributes cash of $75,000 and receives 15,000 shares of $1 par value stock.
b. Collette contributes $35,000 cash, office furniture with a value of $5,000, and computer equipment with a value of $10,000 and receives 15,000 shares of $1 par value stock. The furniture and equipment is expected to last 5 years and has no salvage value.
c. On January 2, $10,000 of painting products are purchased. CC paid $8,000 cash with the remaining amount on account.
d. During January, painting products are sold for $8,000 cash. The cost of the products is $2,000.
e. Additional painting products with a value of $5,000 are sold, with a cost of $1,500, but the cash is not collected as of January 31st. It is expected that the $5,000 will be collected in full by February 15th.
f. Cohen is paid a salary of $2,000.
g. CC paid $1,200 for January and February rent. 
Required:
Prepare appropriate accrual basis journal entries.

Quizplus · Accepted Answer

The Answer of Collette and Cohen incorporate as CC Designs, Inc.on January 1, Year 1.CC Designs creates custom wall finishes and sells painting products.The following transactions occur during January.
 a. Cohen contributes cash of $75,000 and receives 15,000 shares of $1 par value stock.
b. Collette contributes $35,000 cash, office furniture with a value of $5,000, and computer equipment with a value of $10,000 and receives 15,000 shares of $1 par value stock. The furniture and equipment is expected to last 5 years and has no salvage value.
c. On January 2, $10,000 of painting products are purchased. CC paid $8,000 cash with the remaining amount on account.
d. During January, painting products are sold for $8,000 cash. The cost of the products is $2,000.
e. Additional painting products with a value of $5,000 are sold, with a cost of $1,500, but the cash is not collected as of January 31st. It is expected that the $5,000 will be collected in full by February 15th.
f. Cohen is paid a salary of $2,000.
g. CC paid $1,200 for January and February rent. 
Required:
Prepare appropriate accrual basis journal entries.

Collette and Cohen Incorporate as CC Designs, Inc