John Hasty opened his bakery on March 1, 1999. The following transactions took place in early March:
1. Deposited $10,000 into a checking account in the name of the Hasty Bakery.
2. Leased a small kitchen for one year at $500 per month. One month’s rent was paid at this time.
3. Purchased kitchen equipment for $3,000 cash.
4. Purchased baking ingredients for $6,000 on account.
5. Obtained a $2,000, nine percent, one-year loan.
6. Rented a delivery truck for three years. The monthly payment of $200 is due at the end of each month. Nothing was paid in March.
7. Obtained a one-year insurance policy on the kitchen equipment. Paid the entire premium of $500.
Required
a. Prepare the journal entries to record these transactions.
b. Prepare any necessary adjusting entries (such as interest expense).
c. Post all journal entries to T-accounts.
d. Prepare a trial balance.
e. Prepare a balance sheet for the Hasty Bakery as of March 31, 1999.