Joel Henry founded Bookmart.com at the beginning of August, which sells new and used booksonline. He is passionate about books but does not have a lot of accounting experience. Help Joelby preparing journal entries for the following events. If the event is not a transaction, write “notransaction.”a. The company purchased equipment for $4,000 cash. The equipment is expected to be used for10 or more years.b. Joel’s business bought $7,000 worth of inventory from a publisher. The company will pay thepublisher within 45–60 days.c. Joel’s friend Sam lent $4,000 to the business. Sam had Joel write a note promising thatbookmart.com would repay the $4,000 in four months. Because they are good friends, Sam isnot going to charge Joel interest.d. The company paid $1,500 cash for books purchased on account earlier in the month.e. Bookmart.com repaid the $4,000 loan established in ( c )
Joel Henry founded Bookmart.com at the beginning of August, which sells new and used books
online. He is passionate about books but does not have a lot of accounting experience. Help Joel
by preparing
transaction.”
a. The company purchased equipment for $4,000 cash. The equipment is expected to be used for
10 or more years.
b. Joel’s business bought $7,000 worth of inventory from a publisher. The company will pay the
publisher within 45–60 days.
c. Joel’s friend Sam lent $4,000 to the business. Sam had Joel write a note promising that
bookmart.com would repay the $4,000 in four months. Because they are good friends, Sam is
not going to charge Joel interest.
d. The company paid $1,500
e. Bookmart.com repaid the $4,000 loan established in ( c )
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