Answer:
Required 1
<u>General Journal</u>
Cash $8,500 (debit)
Donations Revenue $8,500 (credit)
<em>Cash and Checks received as Donation Revenue</em>
<em />
Wages Expenses $3,000 (debit)
Cash $3,000 (credit)
<em>Wages to employee paid</em>
<em />
Note Payable $3,420 (debit)
Cash $3,420 (credit)
<em>Repayment of Short Term Loan</em>
<em />
Supplies $4,920 (debit)
Cash $2,080 (credit)
Note Payable $2,840 (credit)
<em>Purchase of Toys on cash and on credit</em>
<em />
Supplies $4,020 (debit)
Donations Revenue $4,020 (credit)
<em>Donations revenue received in form of Toy Supplies</em>
Required 2
Net Income is $9,520
Explanation:
<u>Calculation of Charity’s preliminary net income.</u>
Donations Revenue ($8,500 + $4,020) $12,520
Less Expenses :
Wages ($3,000)
Net Income/ (Loss) $9,520
