P11-1A Team Assignment

P11-1A Team Assignment - Hint: Use one-third of a month for...

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P11-1A On January 1, 2008, the ledger of Mane Company contains the following liability accounts. Accounts Payable $52,000 Sales Taxes Payable 7,700 Unearned Service Revenue 16,000 During January the following selected transactions occurred. Jan. 5 Sold merchandise for cash totaling $22,680, which includes 8% sales taxes. 12 Provided services for customers who had made advance payments of $10,000. (Credit Service Revenue.) 14 Paid state revenue department for sales taxes collected in December 2007 ($7,700). 20 Sold 800 units of a new product on credit at $50 per unit, plus 8% sales tax. 21 Borrowed $18,000 from UCLA Bank on a 3-month, 8%, $18,000 note. 25 Sold merchandise for cash totaling $12,420, which includes 8% sales taxes. Instructions (a) Journalize the January transactions. (b) Journalize the adjusting entries at January 31 for the outstanding notes payable. (
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Unformatted text preview: Hint: Use one-third of a month for the UCLA Bank note.) (c) Prepare the current liabilities section of the balance sheet at January 31, 2008. Assume no change in accounts payable. Solution (a) Jan. 5 Cash 24,494.40 Sales 22,680 Sales Tax Payable 1,814.40 12 Unearned Service Revenue 10,000 Service Revenue 10,000 14 Taxes Payable 7,700 Cash 7,700 20 Accounts Receivable 40,000 Sales 43,200 Sales Tax Payable 3,200 21 Cash 18,000 Notes Payable 18,000 25 Cash 11,500 Sales 12,420 Sales Tax Payable 920 (b) Jan. 31 Interest Expense 160 Interest Payable 160 (c) Mane Company Balance Sheet (partial) Current liabilities Notes Payable 52,000 Unearned Service Revenue 6,000 Taxes Payable 7,700 Interest Payable 160 Total current liabilities 65,860...
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This note was uploaded on 03/28/2011 for the course ACCT 349 taught by Professor Goyal during the Spring '09 term at University of Phoenix.

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P11-1A Team Assignment - Hint: Use one-third of a month for...

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