Reference no: EM132480000

Question a) Record note payable.

Rabbitt Enterprises borrows $60,000 from LowLand Trust Co. on July 1, 2017 signing a 4%, one-year note payable. Interest is to be paid at maturity. Prepare journal entries for Rabbitt Enterprises to record: (a) the receipt of the proceeds of the note; (b) the journal entry to record the accrued interest at December 31, assuming adjusting entries are made only at year end; and (c) the payment of the note at maturity.

Question b) Calculate sales taxes and record sales.

Blue Robin Retail has one store in Ottawa and one in Regina. All sales in Ontario are subject to 13% HST; all sales in Saskatchewan are subject to 5% GST and 5% PST. On March 12, 2017, the Ottawa store reports cash sales of $7,200 and the Regina store reports cash sales of $8,400. (a) Calculate the sales taxes each store charged for these sales. (b) Make a journal entry for each store to record the sales on March 12, 2017.

Question c) Calculate HST and record sales.

Backyard Shed Solutions sells its largest shed for $1,800 plus HST of 13%. On May 10, 2017, it sold 40 of these sheds. On May 17, 2017, the company sold 95 of these sheds. All sales are cash sales. For each day's sales, (a) calculate the HST and (b) Make a journal entry to record the sales.

Question d) Record property tax.

Dresner Company has a December 31 fiscal year end. It receives a $9,600 property tax bill for the 2017 calendar year on March 31, 2017. The bill is payable on June 30. Prepare entries for March 31, June 30, and December 31, assuming the company adjusts its accounts annually.

Question e) Record warranty.

In 2017, Song Company introduces a new product that includes a two-year warranty on parts. During 2017, 4,400 units are sold for $450 each. The cost of each unit was $175. The company estimates that 5% of the units will be defective and that the average warranty cost will be $85 per unit. The company has a December 31 fiscal year end and prepares adjusting entries on an annual basis. Make an adjusting entry at December 31, 2017, to accrue the estimated warranty cost.

Question f) Record loyalty rewards issued and redeemed.

One-Stop Department Store has a loyalty program where customers are given One-Stop "Money" for cash or debit card purchases. The amount they receive is equal to 2% of the pre-tax sales total. Customers can use the One-Stop Money to pay for part or all of their next purchase at One-Stop Department Store. On July 3, 2017, Judy Wishloff purchases merchandise and uses $50 of One-Stop Department Store money. What entry or entries will One-Stop Department Store record for this transaction? Ignore taxes.