Tides Tea Company began operations on January 1 2015

During #2988
Tides Tea Company began operations on January 1, 2015. During the first year of business, the
company had the following transactions: • January 18: The owners invested $ 200,000 (the par
value of the stock) into the business and acquired 40,000 shares of common stock in return. •
February 1: Tides bought factory equipment in the amount of $ 45,000. The company took out a
long- term note from the bank to finance the purchase. • February 28: The company paid cash
for rent to cover the 12- month period from March 1, 2015, through February 29, 2016, in the
amount of $ 27,000. • March 1: Tides purchased supplies in the amount of $ 28,000 on
account. • March 22: Tides recorded sales revenue in the amount of $ 120,000. Half of this
amount was received in cash and half was paid on account. Ignore cost of goods sold. • May 1:
Tides received cash payments to pay off all the customer accounts. • May 29: The company
paid wages of $ 34,000 in cash. • July 12: Tides recorded sales revenue in the amount of $
180,000, all of which was paid in cash. Ignore cost of goods sold. • July 31: Tides paid $ 3,200
cash for interest on the note taken out on February 1. • August 8: Tides paid off the balance
owed to a supplier for the purchase made on March 1. • September 1: Tides paid $ 6,000 cash
for utilities. • October 14: Tides paid wages of $ 24,000 in cash. • November 10: Tides recorded
sales revenue in the amount of $ 218,000. One payment of $ 100,000 was received in cash; the
remainder of this balance was sold on account. Ignore cost of goods sold. • December 31:
Tides paid a $ 25,000 dividend. The chart of accounts used by Tides Tea Company is as
follows:Requireda. Journalize the transactions for the year. b. Post the journal entries to the
general ledger. c. Prepare an unadjusted trial balance as of December 31.View Solution:
Tides Tea Company began operations on January 1 2015 During

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