You are the controller at Star Wars, Inc. you must Create Journal Entries for th

Question

You are the controller at Star Wars, Inc. you must Create Journal Entries for the following transactions.

1. On Dec. 17 Paid off purchase from Dec. 10 to Land Speeder Inc.

2. On Dec. 17 Yoda, Inc. agrees to convert its overdue $20,000 A/R balance into a 12% note due in 10 months.

3.On Dec. 18 Purchased a new supercomputer from Palpatine Computing Co. for $38,000. A down payment of $5,000 was paid immediately, the remainder is owed within 45 days (n/45). Use the equipment account.

4.On Dec. 18 Purchased 400 units of product from Tattooine Ltd. For $375 each on credit, terms n/60

5.On Dec. 19 Purchased 100 units from Tattooine Inc. for $376 each on credit, terms n/60

6.On Dec. 19 Cash sales for 310 units was $800 each.

7.On Dec. 19 Paid $877 telephone bill from November to Galaxy Far, Far Away Communications Inc. Use Misc. expenses.

8.On Dec. 20 Received payment from Princess Leia Co. from the Dec. 11 sale.

9.On Dec. 20 Paid Federal withholding taxes of $13,521, and FICA withholdings of $3,825 to the US Treasury Department. These amounts were previously recorded as liabilities. The amounts were paid with one check.

10.On Dec. 21 Sold Storm Troopers Unlimited 320 units of product for $825 per unit on credit.

Explanation / Answer

17-Dec Accounts payable Dr         Cash Cr ( To record payment of purchases) 17-Dec Accounts payable Dr 20000               12% Notes payable Cr 20000 ( To record conversion of payable to note) 18-Dec Equipment A/c Dr 38000               Cash Cr 5000               Accounts payable Cr 33000 ( To record purchase of equipment) 19-Dec Inventory Dr 37600              Accounts payable Cr 37600 ( To record purchase of inventory) 19-Dec Cash Dr 248000               Revenue Cr 248000 ( To record sale) 19-Dec Misc expenses Dr 877                Cash Cr 877 ( To record payment of November tel bill) 20-Dec Cash Dr 877              Accounts receivable Cr 877 20-Dec Federal withholding tax payable Dr 13521 FICA payable Dr 3825                    Cash Cr 17346 ( To record payment of November payroll taxes) 21-Dec Accounts receivable Dr 264000               Revenue Cr 264000 ( To record sale of 320 units)

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