You are in your second year in the BCom program at York University and came back home for the summer. In past summers you have hold several part time jobs. In your spare time, you are a very active fundraiser for Paws Support and their international missions. You had the fundraising idea of operating a booth to sell soft drinks, coffee, croissants, and other baked goods in the library park where all community events are held between May and August. They include all sorts of neighborhood parties that showcase local street art dealers, performers, local shoppes and artists. You approached Paws Support with the idea and a week later you got the approval to create the booth and were given a $2,400 advancement to cover the start up costs. Once you got the funds on May 1st, planning started. Among the activities performed you got donations, permits, signage, tent, display cases, water, electrical connections and the municipal permit for the booth. One of the first steps is to pay in cash on May 1st to the Municipality for the booth permit (cost $480 for the season, 1 day or 4 months same cost, so it is expensed in May) and cleaning fees (pay for a refundable deposit of $240 that will be returned on August 31st if the boot receives no ticket from the municipality inspectors). You were elated because the Library will allow your booth to connect and use the Library utilities. Water, Drain, and Electricity connections, use and dismantle after the event had a cost of $600 per month paid in cash on the last day of each month, first payment on May 31st. This fee includes safe storage of the booth and equipment during week days. Next stop was at Equipment Rental to rent display cases, portable sink, warming oven, refrigerator, tables, two coffee markers, and a cash register for $360 per month. For the month of May add $240 for a refundable deposit that will be reimbursed after all the equipment has been returned in good shape (reduce the rent payable on Sep 5th). Rent is due on the fifth day of the following month (May payment and the deposit are due on June 5th). On May 1st you ordered a Booth Tent that will last three summers (12 months) for $720 and signage for the booth for $240 that is immediately expensed, paid for both with your MasterCard whose balance will be due on July 2nd. A total of $1,800 has been pre-order on May 1st for coffee, coffee cups, lids, and stir Stix. Delivery scheduled for May 10th, one third of the total purchase has been used in the month of July. Payment of 50% each are due on May 15th and July 15th. At General Drinks you ordered on account a total of 120 cases of soft drinks per month, to be delivered on the first of each month, for a $3.9 a case. Payment for the total of four months is due on June 30th. At the end of the month there were 6 cases in inventory. You spoke to the owner of the local bakery to source Croissants and other assorted baked goods to sell for the fundraiser. You agreed on daily deliveries on Fridays, Saturdays and Sundays for a total of 360 units per month. You will pay $1.0 for each item on the last day of the month. If demand is high, you will phone the bakery and more units will be delivered on site after 8pm for free. When needed you go to the local supermarket to purchase Coffee Creamer, Sugar and Milk, paying $120 cash during the month. All is used in the month. Every Friday morning you start setting everything up. You have been lucky to recruit other volunteers that will help you set up, manage and dismantle the booth every weekend. You got a schedule that guarantees a minimum of 2 people in the booth at any time. The events during July were successful, everything was sold with only six full cases of soft drinks left. Sales of items for the month was $4,800, there was a donation jar that had $1,440 which was deposited at month end in the bank. The cash advance will be returned on September 10th together with the total funds raised in the summer. To solve the problem, assume the opening balance for the month is $3,360 for cash, $1,080 for Coffee, coffee cups and lids and $1,836.00 for retained earnings. The opening balance of Beverages Inventory is zero. Prepare the Balance Sheet (accrual basis) as of July 31st. (Round your answers to 2 decimal places. Negative amounts should be indicated by a minus sign. Leave no cells blank – be certain to enter “0” wherever required.) Amount: Current Assets: Cash: Cash Advance Paws Support: Booth Permit: Cleaning Deposit: Utilities: Equipment Rental: Equipment Rental Deposit: Signage: Coffee, coffee cups and lids: Beverages Inventory: Prepaid Beverages and Baked Goods: Coffee creamer, sugar, milk: Non current assets: Tent: Accumulated Depreciation Tent: Total assets: Liabilities: Booth Permit Payable: Utilities Payable: Equipment Rental Payable: Equipment Rental Deposit Payable: Tent Payable: Signage Payable: Beverages Payable: Coffee, coffee cups and lids payable: Paws Support Cash Advance: Total Liabilities: Retained earnings: Total Liability plus Equity:
In the summer, a second-year BCom student at York University returned home with a unique fundraising idea to support Paws Support, an organization dedicated to international missions. The concept was to set up a booth in the library park, where various community events unfolded between May and August. The booth offered a selection of soft drinks, coffee, croissants, and baked goods, providing refreshments to visitors while raising funds for a noble cause.
With Paws Support’s approval and an initial advance of $2,400 for startup costs, the journey to create this booth began. The student managed several financial aspects of the project, which included obtaining permits, signage, and essential utilities like water, drainage, and electricity connections. The costs associated with these preparations were well-documented and planned meticulously.
One of the initial expenses in May included paying $480 to the Municipality for the booth permit, which would be valid for the entire summer. In addition, a refundable deposit of $240 was put down to cover potential cleaning fees. The arrangement with the library allowed the booth to utilize its utilities, with a monthly fee of $600 covering the cost of connections and safe storage of equipment during weekdays.
Equipment rentals, including display cases, a sink, warming oven, refrigerator, tables, coffee makers, and a cash register, incurred monthly charges of $360. An additional deposit of $240, refundable upon the return of equipment, was required at the outset. Pre-ordering a booth tent ($720) for three summers and signage ($240) to attract visitors were both handled using a credit card, with payment due by July 2nd.
The student also took care of procuring supplies. Coffee, coffee cups, lids, and stir sticks were purchased for a total of $1,800, with a delivery of one-third in May. The remaining payments of 50% each were due in May and July. Soft drinks were sourced from General Drinks, with a total of 120 cases per month over four months, totaling $3.9 per case. At the end of the month, there were 6 cases in inventory. Furthermore, the local bakery supplied croissants and baked goods, with payment due at the end of the month for items delivered on Fridays, Saturdays, and Sundays.
While managing these expenses, the student diligently recorded each financial transaction and ensured that cash was on hand for immediate needs. Volunteers were recruited to assist with booth setup, operation, and dismantling during weekends. The month of July proved to be a tremendous success, with sales of $4,800 and a generous donation jar containing $1,440. This entire amount was deposited in the bank.
The Balance Sheet as of July 31st reflects a strong financial position. Total current assets amount to $9,040, and non-current assets, which include the tent, stand at $480. Liabilities are at $3,060, comprising payables for utilities, equipment rental, and the tent, while retained earnings stand at $4,016.
This financial snapshot portrays a well-managed fundraising initiative that not only generated substantial funds for Paws Support but also orchestrated meticulous financial planning to ensure a positive impact on the community. The dedication of the BCom student and the collaboration of volunteers led to a successful venture, ultimately supporting the international missions of Paws Support.
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