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Jan 31st Q - Jan 31st 2011 SI Session Nougat Corporation...

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Jan 31 st , 2011 SI Session Nougat Corporation was founded on January 3, 2001. The company operates a retail store that sells hand-crafted chocolates. Below is the balance sheet as at December 31, 2006: Nougat Corporation Balance Sheet as at December 31, 2006 Cash 25,300 Accounts payable 17,200 Accounts receivable 41,600 Income tax payable 5,400 Inventory 28,000 Bank loan 60,000 Prepaid expenses 6,500 Capital stock 50,000 Equipment 86,000 Retained earnings 54,800 TOTAL: $187,400 TOTAL: $187,400 a. Prepare journal entries to record the following transactions for 2007. 1. The corporation purchased inventory for sale during 2007 at a cost of $233,000. All purchases were made on account. 2. Sales revenue totaled $316,000 for 2007. $212,000 was for cash, the remaining $104,000 was on credit. 3. During 2007 the corporation collected $103,400 from credit customers. 4. During 2007 the corporation paid $247,000 to suppliers for inventory previously purchased on account.
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5. The cost of the inventory sold in transaction 2 was $230,000. 6. Nougat repaid $18,000 of the bank loan during 2007.
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