Cookie creations (chapter 11 and 15)

This assignment is a continuation of the Cookie Creations case study and focuses on Cookie Creations’ liabilities (current and long-term). From the information gathered from the unit lesson, required unit resources, and suggested unit resources, read the Cookie Creations case study below, which is also available on p.11-37 (Chapter 11) and p. 15-38 (Chapter 15) in the textbook. 

The case study allows you to apply what you have learned about liabilities and the accounting process. This assignment will allow you to practice what you have learned so far. 

Part I

Recall that Cookie Creations sells fine European mixers that it purchases from Kzinski Supply Company. Kzinski warrants the mixers to be free of defects in material and workmanship for 1 year from the date of original purchase. If the mixer has such a defect, Kzinski will repair or replace the mixer free of charge for parts and labor. The product must be shipped prepaid to an authorized Kzinski service center. The consumer pays the cost to ship the mixer. The cost to return the product to the consumer is paid by Kzinski. 

The authorized service center is located in Boston. Because Cookie Creations values serving its customers, it pays the shipping to Boston for any mixers needing repair under Kzinski’s warranty terms. Based on past experience, Kzinski has found that approximately 10% of mixers are returned for repair or replacement. The average cost to ship a mixer to Boston is $60. 

The following transactions take place in 2020 and 2021. 

  1. A total of 30 mixers are sold in 2020.
  2. Four of the mixers sold in 2020 are returned for repair in 2021. The total shipping cost for returning these four mixers to Boston is $210. 
  3. A total of 40 mixers are sold in 2021.
  4. Two of the mixers sold in 2021 are returned for repair in 2021. The total shipping cost for returning these two mixers to Boston is $55. 

For Part I of the assignment, complete the tasks listed below using Excel.

  1. Calculate Cookie Creations’ warranty liability for the shipping costs at December 31, 2020.
  2. Record the estimated warranty liability at December 31, 2020.
  3. Prepare the summary journal entry (or entries) to record the shipment of the six mixers (four from the 2020 sales and two from the 2021 sales) for warranty repair in 2021. d. 
  4. Calculate Cookie Creations’ warranty liability at December 31, 2021. (Hint: Note that there is no liability outstanding for the mixers sold in 2020. The 1-year warranty period has expired.)
  5. Record the estimated warranty liability at December 31, 2021. (Hint: Similar to accounting for bad debts, consider any existing balance in the warranty liability account when you prepare your entry. You will find it helpful to prepare a general ledger account for the warranty liability and to post the above transactions.) 
Part II

Natalie and Curtis have been experiencing great demand for their cookies and muffins. As a result, they are now thinking about buying a commercial oven. They know which oven they want and that it will cost $17,000. The company already has $5,000 set aside for the purchase and will need to borrow the rest. 

Natalie and Curtis met with a bank manager to discuss their options. She is willing to lend Cookie & Coffee Creations Inc. $12,000 on November 1, 2020, for 3 years at a 5% interest rate. The terms provide for fixed principal payments of $2,000 on May 1 and November 1 of each year plus 6 months of interest. 

For Part II of the assignment, complete the tasks listed below. 

  1. Prepare a payment schedule for the life of the note. 
  2. Prepare the journal entry for the purchase of the oven and the issue of the note payable on November 1, 2020. 
  3. Prepare the journal entries on May 1 and November 1 for the note.
  4. Determine the current portion of the note payable and the long-term portion of the note payable at October 31, 2021. 

Parts I and II should be submitted in a single Excel spreadsheet. You will use a new tab to complete each transaction for both Parts I and II for a total of nine separate tabs or sheets. Submit the Excel spreadsheet in Blackboard.

Semester Papers
Calculate your paper price
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

Professional and Experienced Academic Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

24/7 Customer Support

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

Calculate the price of your order

Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.


Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.


Admission Essays & Business Writing Help

An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.


Editing Support

Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.


Revision Support

If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.

error: Content is protected !!