On January 1, 2010, the ledger of Glennon Company contained these liability acco
ID: 2379705 • Letter: O
Question
On January 1, 2010, the ledger of Glennon Company contained these liability accounts.Accounts payable $49,020
Sales Taxes Payable 7,316
Unearned service revenue 26,330
During January the following selected transactions occurred.
Jan. 1 Borrowed $21,300 in cash from Midland Bank on a 4-month 8%, $21,300 note.
Jan. 5 Sold merchandise for cash totaling $7,518, which includes 5% sales taxes.
Jan. 12 Provided services for customers who had made advance payment of $17,944. (Credit Service Revenue.)
Jan. 14 Paid state treasurer's department for sales taxes collected in December 2009, $6,696.
Jan. 20 Sold 550 units of a new product on credit at $47 per unit, plus 5% sales tax.
During January the company's employees earned wages of $76,250. Withholdings related to these wages were $5,833 for Social Security (FICA), $5,452 for federal income tax, and $1,525 for state income tax. The company owed no money related to these earnings for federal or state unemployment tax. Assume that wages earned during January will be paid during February. No entry had been recorded for wages or payroll tax expense as of January 31.
Journalize the adjusting entries at January 31 for the outstanding notes payable and for wages expense and payroll tax expense. (List multiple debit/credit entries from largest to smallest amount, e.g. 10, 5, 2.)
Explanation / Answer
Jan. 1 Borrowed $21,300 in cash from Midland Bank on a 4-month 8%, $21,300 note. Dr Cash 21.300 Cr Notes Payable 21,300 Jan. 5 Sold merchandise for cash totaling $7,518, which includes 5% sales taxes. Dr Cash 7518 Cr Sales 7316 Cr Sales Tax Payable 202 Jan. 12 Provided services for customers who had made advance payment of $17,944. (Credit Service Revenue.) Dr Unearned Service Revenue 17,944 Cr Service Revenue 17,944 Jan. 14 Paid state treasurer's department for sales taxes collected in December 2009, $6,696. Dr Sales Tax Payable6,696 Cr Cash6.696 Jan. 20 Sold 550 units of a new product on credit at $47 per unit, plus 5% sales tax. Dr Accounts Receivable 26,330 Cr Sales 25,850 Cr Sales Tax Payable 480 Journalize the adjusting entries at January 31 for the outstanding notes payable and for wages expense and payroll tax expense. Dr Interest Expense 102 Cr Interest on Notes Payable 102 Dr Wages Expense 76,250 Cr Employee Social Security (FICA) Tax Payable 5,833 Cr Employee Federal Income Tax Payable 5,452 Cr Employee State Income Tax Payable 1,525 Cr Wages Payable 63,440 Dr Payroll Tax Expense 5,833 Cr Social Security Tax Payable 5,833
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.