Below are the transactions for Backstitch Sewing Shop for March, the first month of operations.
March 1 Issue common stock in exchange for cash of $1,500.
March 3 Purchase sewing equipment by signing a note with the local bank, $1,200.
March 5 Pay rent of $450 for March.
March 7 Martha, a customer, places an order for alterations to several dresses. Backstitch estimates that the alterations will cost Martha $650. Martha is not required to pay for the alterations until the work is complete.
March 12 Purchase sewing supplies for $115 on account. This material will be used to provide services to customers.
March 15 Backstitch delivers altered dresses to Martha and receives $650.
March 19 Backstitch agrees to alter 10 business suits for Bob, who has lost a significant amount of weight recently. Backstitch receives $550 from Bob and promises the suits to be completed by March 25.
March 25 Backstitch delivers 10 altered business suits to Bob.
March 30 Pay utilities of $80 for the current period.
March 31 Pay dividends of $75 to stockholders.
Required:
1. Record each transaction.
2&3. Post each transaction to the appropriate T-accounts and calculate the balance of each account at March 31.
