Jessica Pothier opened FunFlatables on June 1 The

company rents #2701

Jessica Pothier opened FunFlatables on June 1. The company rents out moon walks and
inflatable slides for parties and corporate events. The company also has obtained the use of an
abandoned ice rink located in a local shopping mall, where its rental products are displayed and
available for casual hourly rental by mall patrons. The following transactions occurred during the
first month of operations.1. Jessica contributed $ 50,000 cash to the company on June 1 in
exchange for its common stock.2. Purchased inflatable rides and inflation equipment on June 2,
paying $ 20,000 cash.3. Received $ 5,000 cash from casual hourly rentals at the mall on June
3.4. Rented rides and equipment to customers for $ 10,000. Received cash of $ 2,000 on June
4 and the rest is due from customers.5. Received $ 2,500 from a large corporate customer on
June 5 as a deposit on a party booking for July 4.6. Began to prepare for the July 4 party by
purchasing various party supplies on June 6 on account for $ 600.7. On June 7, paid $ 6,000 in
cash for renting the mall space this month.8. On June 8, prepaid next month’s mall space rental
charge of $ 6,000.9. Received $ 1,000 on June 9 from customers on accounts receivable.10.
Paid $ 1,000 for running a television ad on June 10.11. Paid $ 4,000 in wages to employees on
June 30 for work done during the month.Required:1. Record the effects of transactions (1)
through (11) using journal entries.2. If you are completing this requirement manually, set up
appropriate T- accounts. All accounts begin with zero balances. Summarize the journal entries
from requirement 1 in the T- accounts, referencing each transaction in the accounts with the
transaction number. Show the unadjusted ending balances in the T- accounts. If you are using
the GL tool in Connect, your answers to requirement 1 will have been posted automatically to
general ledger accounts that are similar in appearance to Exhibit 2.9.3. Prepare an unadjusted
trial balance for the end of June. If you are using the GL tool in Connect, this requirement is
completed automatically using your previous answers.4. Refer to the revenues and expenses
shown on the unadjusted trial balance to calculate preliminary net income and determine
whether the net profit margin is better or worse than the 30.0 percent earned by a close
competitor.View Solution:
Jessica Pothier opened FunFlatables on June 1 The company rents

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