Answer:
1. Feb-01
Dr Rent expense 500
Cr Cash 500
Feb-04
Dr Cash 1510
Cr Unearned freight revenue 1510
Feb-07
Dr Cash 1410
Cr Freight revenue 1410
Feb-10
Dr Wages and salaries expense 1500
Cr Cash 1500
Feb-14
Dr Advertisement expenses 116
Cr Cash 1165
Feb-18
Dr Cash 860
Cr Freight revenue 860
Dr Accounts receivable 2130
Cr Freight revenue 2130
Feb-25
Dr Supplies 1755
Cr Accounts payable 1755
2. $2,284
3. 51.90%
Explanation:
1. Preparation of accrual basis journal entries for each transaction
Feb-01
Dr Rent expense 500
Cr Cash 500
Feb-04
Dr Cash 1510
Cr Unearned freight revenue 1510
Feb-07
Dr Cash 1410
Cr Freight revenue 1410
Feb-10
Dr Wages and salaries expense 1500
Cr Cash 1500
Feb-14
Dr Advertisement expenses 116
Cr Cash 1165
Feb-18
Dr Cash 860
Cr Freight revenue 860
Dr Accounts receivable 2130
Cr Freight revenue 2130
Feb-25
Dr Supplies 1755
Cr Accounts payable 1755
2.Calculation for the company’s preliminary net income.
Freight revenue 4400
(1410+860+2130)
Less Expenses 2116
(500+1500+116)
Preliminary Net income $2,284
Therefore the company’s preliminary net income will be $2,284
3. Calculation for the company’s net profit margin expressed as a percent
Net profit margin = 2,284/4,400
Net profit margin=0.5190*100
Net profit margin=51.90%
Therefore the company’s net profit margin expressed as a percent will be 51.90%
