Reference no: EM132462623

Problem 1: Which of these actions is a "unearned service revenue"?

Nov. 8 Natalie cashes her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account.

Nov. 8 She opens a bank account under the name "Cookie Creations" and transfers $500 from her personal account to the new account.

Nov.11 Natalie pays $65 for advertising.

Nov.13 She buys baking supplies, such as flour, sugar, butter, and chocolate chips, for $125 cash. (Hint: Use Supplies account.)

Nov.14 Natalie starts to gather some baking equipment to take with her when teaching the cookie classes. She has an excellent top-of-the-line food processor and mixer that originally cost her $750. Natalie decides to start using it only in her new business. She estimates that the equipment is currently worth $300. She invests the equipment in the business.

Nov.16 Natalie realizes that her initial cash investment is not enough. Her grandmother lends her $2,000 cash, for which Natalie signs a note payable in the name of the business. Natalie deposits the money in the business bank account. (Hint: The note does not have to be repaid for 24 months. As a result, the note payable should be reported in the accounts as the last liability and also on the balance sheet as the last liability.)

Nov.17 She buys more baking equipment for $900 cash.

Nov. 20 She teaches her first class and collects $125 cash.

Nov. 25 Natalie books a second class for December 4 for $150. She receives $30 cash in advance as a down payment.

Nov. 30 Natalie pays $1,320 for a one-year insurance policy that will expire on December 1, 2020.