Question 1 Fantastic Fashions has just completed its first quarter of operations. Below are transactions that...

Question 1
Fantastic Fashions has just completed its first quarter of operations. Below are transactions that have not yet been recorded. Prepare the journal entries listed below.

   Jan 1    Pre-tax cash sales amounted to $75,000. HST is collected on all sales at a rate of 13%.
   Jan 15    Signed a three month note for $12,000 to extend amounts owing on account to Trendy Taste Inc. Interest is 6% annually and due at maturity.
   Mar 1    Received the annual property tax bill for $7,500 payable on June 1.
   Apr 1    Paid salaries of $10,000; of this amount $495 is CPP, $178 is EI and $3,465 is for income taxes (record the employer portion as well).
   Apr 15    Paid the note due.
   Apr 29    A customer sued Fantastic Fashions for $200,000. Legal counsel has advised that it is unlikely damages will be awarded.
   Jun 1    Paid the property taxes bill in full.

Expert Solution

The journal entries are attached in below picture

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ekkarill92 answered 2 years ago

Question 1 Fantastic Fashions has just completed its first quarter of operations. Below are transactions that...

Question 1 Fantastic Fashions has just completed its first quarter of operations. Below are transactions that have not yet been recorded. Prepare the journal entries listed below. Jan 1 Pre-tax cash sales amounted to $75,000. HST is collected on all sales at a rate of 13%. Jan 15 Signed a three month note for $12,000 to extend amounts owing on account to Trendy Taste Inc. Interest is 6% annually and due at maturity. Mar 1...

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Question 1 Fantastic Fashions has just completed its first quarter of operations. Below are transactions that...

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