80.2K

Verified Solution

Link Copied!

Billy Bob's Bikes Transactions

Nov. $1$: Billy Bob paid in advance for a $4-$month insurance policy, which will begin today. He paid $$3,856$ cash for the policy.

Nov. $1$: Billy Bob purchased a building for $$967,260$ using $$127,260$ cash and then borrowing the rest from the bank. The loan from the bank will be paid off over the next $16$ years of the principal will be paid off at the end of each year$).$ The loan carries an interest rate of $7\mathrm{.}72\%.$ Interest accrued will be paid off at the end of every year. The building has an expected life of $35$ years, a salvage value of $$217,980$ and will be depreciated using the straight$-$line method.

Nov. $2$: Billy Bob hires Biker Betty for promotional purposes. He estimates her salary to be $$12/$hour$.$ She will probably work $32$ hours this month.

Nov. $3$: Billy Bob purchased $47$ bikes from Paul's Choppers. Each bike cost $$3,850$ and the credit terms are $\frac{2}{10},\frac{n}{30}.($Note: Bikes are considered Inventory$)$

Nov. $3$: Paul's Choppers paid FedEx $$9,871$ cash to ship the bikes to Billy Bob.

Nov. $5$: Billy Bob sold $28$ bikes to Bikes R$\text{'}$ Us for $$8,800$ each with credit terms of $\frac{3}{15},\frac{n}{30}.$ The total cost of the bikes was figured out to be $$105,950.$

Nov. $5$: Billy Bob paid UPS $$5,638$ cash to ship the bikes to Bikes R'Us.

Nov. $7$: Billy Bob returned $2$ of the bikes he purchased from Paul's Choppers.

Nov. $7$: Paul's Choppers paid FedEx $$324$ cash to have the returned bikes shipped back to him.

Nov. $8$: Stockholder's invest $$234,567$ in exchange for Billy Bob$$s Bikes common stock.

Nov. $9$: Bikes R'Us returned $3$ of the bikes they purchased from Billy Bob. The cost of the bikes to Billy Bob was figured out to be $$11,550.$

Nov. $9$: Bikes R$\text{'}$ Us paid FedEx $$421$ cash to have the bikes returned.

Nov. $11$: Billy Bob paid off the balance due from Paul's Choppers.

Nov. $12$: Billy Bob purchased $36$ more bikes from Paul's Choppers. Each bike cost $$3,875$ and the credit terms are $\frac{1}{20},\frac{n}{60}.$

Nov. $12$: Billy Bob paid UPS $$6,999$ cash to ship the bikes he bought from Paul's Choppers.

Nov. $14$: Bikes R$\text{'}$ Us paid his balance off for the bikes he purchased.

Nov. $15$: Billy Bob sold $51$ bikes to Biker's Bargains for $$8,700$ each with credit terms of $\frac{2}{10}$ EOM,$\frac{n}{75}.$ The cost of the bikes was determined to be $$200,949.$

Nov, $15$: Billy Bob paid FedEx $$11,111$ to have the bikes shipped to them.

Journalize transaction

Answer & Explanation Solved by verified expert

See Answer