Texts: On January 1, 2023, Gabby decided to open a business registered as Gabrielle, LLC. Gabby contributed Cash, $1,000,000; and Furniture that has a fair market value of $500,000 and a cost of $300,000. There was an outstanding note of $100,000 on the furniture and Gabrielle, LLC assumed the outstanding note payable. The following are the additional transactions that Gabrielle, LLC engaged in during the month of January, 2023.
Jan 1, interviewed Erich to serve as Operation manager on a part-time basis at a salary of $15,000 per month. Erich accepted the job and agreed to start on January 16, 2023.
Jan 5, Borrowed $600,000 from Bank of America and issued a promissory note to the bank.
Jan 8, Bought supplies for $60,000, paying $40,000 now and promising to pay the balance on January 31, 2023.
Jan 15 Performed $50,000 services for a customer and collected $30,000. The balance is to be collected in the future.
Jan 16, Erich reported for duty as a follow-up on his acceptance of the position as an Operation Manager at a salary of $15,000 per month.
Jan 31, Accrued $6,000 interest on the promissory note issued to the bank on January 5.
Jan 31, Services performed but neither billed nor recorded were $25,000.
Jan 31. Supplies used during the month were $12,000.
Jan 31. Paid Erich $15,000 for the services performed during the month of January.
Jan 31. Paid a dividend of $2,000 to Gabby, the owner.
Jan 31 The furniture has a 7-year life and a salvage value of $10,000. The company uses the straight-line depreciation method.
Required:
a. Prepare general journal entries based on the information above.
b. Post the journal entries to the general ledger.
c. Prepare a trial balance.
d. Prepare an income statement.
e. Prepare a balance sheet.
f. Prepare closing entries.
g. Prepare a post-closing trial balance.
h. Calculate the current ratio.
i. Calculate the working capital.
j. Calculate the gross profit margin.
k. Calculate the return on sales.
l. Prepare a common-size income statement and balance sheet.