(2 marks each x 6 = 12 marks)
In accounting, before transactions are entered into a corporation's accounting system, the underlying
event must be analyzed. From this analysis, an accountant will determine how (and if) the transaction
should be recorded. The situations below relate to Ken & Gary’s Yogurt Corporation; indicate whether
the items below are recordable OR non-recordable events.
1. A new mortgage contract for its new factory building is signed.
2. The first mortgage payment is made.
3. Wages for the current month are paid.
4. A new secretary is hired.
5. Property taxes are paid.
6. HST collections for the current month are forwarded to the CRA.
(2 marks each line x 6 = 12 marks)
Provide the adjustments that would be made on July 31, 2018, the end of the fiscal year, for each of
the following scenarios:
1. The supplies inventory on August 1, 2017 was $8,350. Supplies costing $16,650 were purchased
during the fiscal year and debited to Supplies Inventory. A count on July 31, 2018 indicated supplies on
hand of $6,810.