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Cory Neece is planning to manage and operate Eagle Caddy Service at Canyon Lake Golf and Country Club during June through August 2014. Cory will rent a small maintenance building from the country club for $500 per month and will offer caddy services, including cart rentals, to golfers. Cory has had no formal training in record keeping. Cory keeps notes of all receipts and expenses in a shoe box. An examination of Cory’s shoe box records for June revealed the following:

June 1. Transferred$2,000 from personal bank account to be used to operate the caddy service.

  1. Paid rent expense to Canyon Lake Golf and Country Club, $500.
  2. Paid for golf supplies (practice balls, etc.),$750.
  3. Arranged for the rental of 40 regular (pulling) golf carts and 20 gasoline-driven carts for $3,000 per month. Paid$600 in advance, with the remaining $2,400 due June 20.
  4. Purchased supplies, including gasoline, for the golf carts on account,$1,000. Canyon Lake Golf and Country Club has agreed to allow Cory to store the gasoline in one of its fuel tanks at no cost.
  5. Received cash for services from June 1–15, $5,400.
  6. Paid cash to creditors on account,$1,000.
  7. Paid remaining rental on golf carts, $2,400.
  8. Purchased supplies, including gasoline, on account,$850.
  9. Accepted IOUs from customers on account, $1,800.
  10. Paid miscellaneous expenses,$395.
  11. Received cash for services from June 16–30, $4,200.
  12. Paid telephone and electricity (utilities) expenses,$340.
  13. Paid wages of part-time employees, $850.
  14. Received cash in payment of IOUs on account,$1,500.
  15. Determined the amount of supplies on hand at the end of June, $675.

Cory has asked you several questions concerning his financial affairs to date, and he has asked you to assist with his record keeping and reporting of financial data.

a. To assist Cory with his record keeping, prepare a chart of accounts that would be appropriate for Eagle Caddy Service. Note: Small businesses such as Eagle Caddy Service are often organized as proprietorships. The accounting for proprietorships is similar to that for a corporation, except that the stockholders’ equity accounts differ. Specifically, instead of the account for Capital Stock, a capital account entitled Cory Neece, Capital is used to record investments in the business. In addition, instead of a dividends account, withdrawals from the business are debited to Cory Neece, Drawing. A proprietorship has no retained earnings account.


What are the benefits of a free enterprise economy?

We often think of the American free enterprise economy as having several distinct "players" that ensure its success. These players include entrepreneurs, consumers, and the government. How do you fit in? How does the system benefit you? As a student, you may find that you need extra spending money to cover your school and your living expenses. You may begin thinking about becoming an entrepreneur by creating a small business that will earn you money. You may also decide to look into getting a job. Or you may visit your school's financial aid office to see if there is some form of government student aid, such as a loan, grant, or work-study program.

Answer the following questions:

  1. What type of financial aid might be available to me through my school?


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