by opening a retail sales shop. They have decided to form the business as a corporation called Traveling Gourmet, Inc. The following transactions occurred in March:
a. Received $84,000 cash from each of the two shareholders to form the corporation, in addition to $2,400 in accounts receivable, $6,100 in equipment, a van (equipment) appraised at a fair value of $13,800, and $1,400 in supplies. Gave the two owners each 580 shares of common stock with a par value of $1 per share.
b. Purchased a vacant store for sale in a good location for $400,000, making an $80,000 cash down payment and signing a 10-year mortgage note from a local bank for the rest.
c. Borrowed $54,000 from the local bank on a 10 percent, one-year note.
d. Purchased food and paper supplies costing $11,000 in March; paid cash.
e. Catered four parties in March for $4,600; $1,680 was billed and the rest was received in cash.
f. Sold food at the retail store for $17,100 cash; the food and paper supplies used to cost $10,910. (Hint: Record two the revenue effect separate from the expense effect.)
g. Received a $460 telephone bill for March to be paid in April.
h. Paid $403 in gas for the van in March.
i. Paid $7,080 in wages to employees who worked in March.
j. Paid a $340 dividend from the corporation to each owner.
k. Purchased $54,000 of equipment (refrigerated display cases, cabinets, tables, and chairs) and renovated and decorated the new store for $22.000 (added to the cost of the building); paid cash.
Prepare an unadjusted classified income statement in good form for the month of March.
