Reference no: EM13493232
During the past two years the following selected transactions occurred for Bass Boats Inc.:
Year 1
5-Jan Purchased equipment for $100,000, signing a 9 month, 6% note Payable.
26-Jan Recorded the week's sales of $75,000, 70% on account and 30% cash. All sales are subject to a 6 1/2% sales tax.
7-Feb Remitted last week's sales tax to the appropriate government agency.
1-May Borrowed $150,000 on a 6 year, 8% note payable calling for annual interest payments beginning next May 1.
5-Oct Paid off the January 5 note payable.
30-Nov Purchased inventory at a cost of $7,200, signing a 3-month, 8% note payable for that amount.
31-Dec Accrued warranty expense is estimated at 3% of total sales of $1,000,000.
31-Dec Record accrued interest on all outstanding notes payable (make a separate journal entry for each).
Year 2
28-Feb Paid off the 8% inventory note plus interest at maturity
1-May Paid the interest for one year on the long-term note payable.
| 1 |
Record the transactions in the journal. Omit explanations. |
| |
Journal |
| |
Date |
Accounts |
Post. Ref |
Debit |
Credit |
| |
Jan |
5 |
Equipment |
|
100,000 |
|
| |
|
|
Notes Payable |
|
|
100,000.00 |
| |
|
|
Interest (July) |
|
6,000.00 |
|
| |
|
|
Interest of Notes Payable |
|
|
6,000.00 |
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Jan |
26 |
Sales |
|
75,000.00 |
|
| |
|
|
Accounts Receivable |
|
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52,500.00 |
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|
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Cash |
|
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22,500.00 |
| |
|
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Sales Tax Owed |
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4,875.00 |
|
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|
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Sales Tax |
|
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4,875.00 |
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Feb |
7 |
Sales Tax Owed |
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4,875.00 |
|
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|
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Sales Tax Paid |
|
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4,875.00 |
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May |
1 |
Notes Payable |
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150,000.00 |
|
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|
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8% Note Payable |
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12,000.00 |
|
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|
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Notes Payable with Interest |
|
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162,000.00 |
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Oct |
5 |
Notes Payable (Equipment) |
|
106,000.00 |
|
| |
|
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Cash |
|
|
106,000.00 |
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Nov |
30 |
Inventory |
|
7,200.00 |
|
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|
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Notes Payable |
|
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7,200.00 |
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|
|
Interest (Feb) |
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576.00 |
|
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|
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Interest of Notes Payable |
|
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576.00 |
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