Expert Q&A Done connect A12-5 Common Financial Liabilities and Foreign Currency

Question

Expert Q&A Done connect A12-5 Common Financial Liabilities and Foreign Currency ta regarding Petilila Corp. in March 20x9 Selected opening balances: $62.800 GST payable CPP payable El payable Income tax deductions payable 3.900 (or) 5200 (o) 16.320 (or) a. Cash sales for the period, $980,000 plus 5% GST. b. Monthly payroll, $117,000; less El, $3,800; CPP, $2.200, income tax, $12.200. The employer portion of payroll taxes was also recorded c. Invent purchases on ourt, S 1,520,000 plus 5% GST Cash sales, $3.140,000, plus 5% GST e. Sales to U.S. customer on account, US$176,000. There was no GST on the sale. The U.S dollar was worth Cdn$1.03 on this date t. The U.S. customer paid US$140,000 on account, when the U.S. dollar was worth $1.07. The remaining amount will be paid in June. g GST owing was remited. h. Sixty percent of the amount owing to suppliers in (c) was paid L At the end of the month, the U.S. exchange rate was Cdn$1.06 Required: 1. Journalize all transactions listed above. List the accounts and amounts that would appear on the 31 March statement of tinancial position. Exclude cash and inventory. A12-6 Provisions:

Explanation / Answer

1. Journal Entries

2.

Sr. No. Particulars Debit Credit 1 Cash 1.029,000 Sales 980,000 GST 49,000 2 Wages 98,800 Employer Payroll Taxes (EI, CPP and Income tax) 18,200 Employer Payroll Taxes Payable 18,200 Cash 98,800 3 Purchase 1,520,000 GST 76,000 Accounts Payable 1,596,000 4 Cash 3,297,000 Sales 3,140,000 GST 157,000 5 Accounts Receivable (176000*1.03) 181,280 Sales 181,280 6 Cash (140000*1.07) 149,800 Accounts Receivable 144,200 Foreign currency transaction gain 5,600 7 GST (62,800 + 49,000 - 76,000 + 157,000) 192,800 Cash 192,800 8 Accounts Payable (1,596,000 * 60%) 957,600 Cash 957,600

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