Use the following scenarios to create journal entries about their effects on net income:

1. May 1, 2012--Joe purchased flour for his doughnut business and put the total on his account at Flour Mill, Inc. The cost of the flour is $620, plus shipping of $60. Create the journal entry to account for transportation costs.

2. June 2, 2012--He ran out of icing and ordered $450 of chocolate icing and $150 of vanilla icing, adding the total to his account at Flour Mill, Inc. Shipping costs were $50. One tub of icing was caramel, so he returned it for a credit of $65.

3. July 3, 2013--Joe needed sugar and ordered it in bulk, at a cost of $325, which included $25 in shipping charges. This purchase was from Flour Mill, Inc.

4. August 4, 2012--Joe ordered yeast for his business from Flour Mill, Inc. The cost of yeast was $130, plus $15 shipping.

When it arrived, a bag was broken and spilled. The company credited his account for $20.

5. September 5, 2012--Joe paid his bill at Flour Mill, Inc. He received a 2% discount for being a loyal customer.

You can create your own sheet