Reference no: EM133168516
Question - Bling-Or Ltd. sells jewelry. On July 1, 2021, the company sent a three-month $12,000, 3% note payable to Goldish due on September 30, 2021. Interest is payable at maturity. The company records adjusting entries annually at its year end, December 31.
During the next four months, Bling-Or incurred the following:
September 1: purchased inventory on account for $15,000 from Black Diamond, terms n/30. The company uses IFRS and a perpetual inventory system.
September 30: repaid the $12,000 note payable to Goldish, as well as any interest owed.
October 1: issued a six-month, 4%, $15,000 note payable to Black Diamond in exchange for the account payable (see September 1 transaction). Interest is payable at maturity.
October 2: borrowed $25,000 cash from NationalBank for 12 months at 3% to finance the building of a new workshop. Instalments are $2,117.34 payable the first day of each month.
November 1: paid the first instalment of the bank loan
December 1: paid the second instalment of the bank loan
December 31: recorded accrued interests for the Black Diamond note and the NationalBank loan.
Required -
a. Record the above transactions.
b. Assuming Bling-Or does not have any other liabilities, prepare the current liabilities section of the statement of financial position of Bling-Or as at December 31, 2021.
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