Question

On January 1, 2020, the ledger of Coronado Company contains the following liability accounts. Accounts Payable Sales Taxes Payable Unearned Service Revenue $51,000 7,700 16,500 During January, the following selected transactions occurred. Jan. 5 Sold merchandise for cash totaling $20,520, which includes 8% sales taxes. 12 Performed services for customers who had made advance payments of $11,000. (Credit Service Revenue.) 14 Paid state revenue department for sales taxes collected in December 2019 ($7,700). 20 Sold 900 units of a new product on credit at $50 per unit, plus 8% sales tax. This new product is subject to a 1- year warranty. 21 Borrowed $27,000 from Girard Bank on a 3-month, 8%, $27,000 note. 25 Sold merchandise for cash totaling $9,504, which includes 8% sales taxes. Journalize the January transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Debit Credit Date Account Titles and Explanation

Answer 1

Answer-

Date	Account Title and Explanation	Debit ($)	Credit ($)
Jan 5	Cash	20,520
	Sales revenue (20520*100/108)		19,000
	Sales tax payable		1.520
Jan 12	Account receivable	11,000
	Service revenue		11,000
Jan 14	Sales tax payable	7,700
	Cash		7,700
Jan 20	Account receivable (900*50*1.08)	48,600
	Sales revenue (900*50)		45,000
	Sales tax payable (45,000*8%)		3,600
Jan 21	Cash	27,000
	Notes payable		27,000
Jan 25	Cash	9,504
	Sales revenue (9,504*100/108)		8,800
	Sales tax payable		704

Date	Account	Debit	Credit
Jan. 31	Interest	$        60		= 27,000 X 8% X 1/3 / 12
	Interest Payable		$       60
Jan. 31	Warranty Expense	$    3,150		= 45,000 X 7%
	Warranty Payable		$    3,150

  CORONADO COMPANY
Balance Sheet (Partial)

For the Year Ended January 31,2020

Current Liabilities:-
Accounts Payable	$51,000
Notes Payable	$27,000
Interest Payable	$60
Sales Tax Payable	$5,824
Warranty Payable	$3,150
Unearned Service Revenue	$5,500
Total Current Liabilities	$92,534