On January 1, 2020, the ledger of Chuan-Kwang contains the following liability accounts (amounts in thousands). Accounts Payable NT$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 NT$20,520, which includes 8% sales taxes. 12 Performed services for customers who had made advance payments of NT$10,000. (Credit Service Revenue) 14 Paid revenue department for sales taxes collected in December 2019 (NT$7,700). 20 Sold 900 units of a new product on credit at NT$50 per unit, plus 8% sales tax. This new product is subject to a 1‐year warranty. 21 Borrowed NT$27,000 from First National Bank on a 3‐month, 8%, NT$27,000 note. 25 Sold merchandise for cash totaling NT$12,420, which includes 8% sales taxes. Instructions: Journalize the adjusting entries at January 31 for (1) the outstanding notes payable, and (2) estimated warranty liability, assuming warranty costs are expected to equal 7% of sales of the new product (Hint: Use one‐third of a month for the First National Bank note)
On January 1, 2020, the ledger of Chuan-Kwang contains the following liability accounts (amounts in thousands). Accounts Payable NT$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 NT$20,520, which includes 8% sales taxes. 12 Performed services for customers who had made advance payments of NT$10,000. (Credit Service Revenue) 14 Paid revenue department for sales taxes collected in December 2019 (NT$7,700). 20 Sold 900 units of a new product on credit at NT$50 per unit, plus 8% sales tax. This new product is subject to a 1‐year warranty. 21 Borrowed NT$27,000 from First National Bank on a 3‐month, 8%, NT$27,000 note. 25 Sold merchandise for cash totaling NT$12,420, which includes 8% sales taxes. Instructions: Journalize the adjusting entries at January 31 for (1) the outstanding notes payable, and (2) estimated warranty liability, assuming warranty costs are expected to equal 7% of sales of the new product (Hint: Use one‐third of a month for the First National Bank note)
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 11RE: On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to...
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On January 1, 2020, the ledger of Chuan-Kwang contains the following liability accounts (amounts in thousands).
| Accounts Payable | NT$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 NT$20,520, which includes 8% sales taxes. |
| 12 | Performed services for customers who had made advance payments of NT$10,000. (Credit Service Revenue) |
| 14 | Paid revenue department for sales taxes collected in December 2019 (NT$7,700). |
| 20 | Sold 900 units of a new product on credit at NT$50 per unit, plus 8% sales tax. This new product is subject to a 1‐year warranty. |
| 21 | Borrowed NT$27,000 from First National Bank on a 3‐month, 8%, NT$27,000 note. |
| 25 | Sold merchandise for cash totaling NT$12,420, which includes 8% sales taxes. |
Instructions:
Journalize the
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