Question

Glenview Hardware had the following transactions that produced liabilities during 2020: a. Purchased merchandise on credit for $30,000. (Note: Assume a periodic inventory system.) b. Year-end wages of $10,000 were incurred, but not paid. Related federal income taxes of $1,200, Social Security of $620 (employee portion), and Medicare taxes of $145 were withheld from employees. c. Year-end estimated income taxes payable, but unpaid, for the year were $42,850. d. Sold merchandise on account for $1,262, including state sales taxes of $48. (Note: Assume a periodic inventory system.) e. Employer's share of Social Security and Medicare taxes for the period were $620 and $145, respectively. f. Borrowed cash under a 90-day, 9%, $25,000 note.

Answer 1

Journal Entry
S. No.	Account Tittle	Debit	Credit
a.	Merchandised Inventory	$30,000.00
	Account Payable		$30,000.00
b.	Wages Expense	$10,000.00
	Income Tax Expense	$1,200.00
	Social Security Taxes Expense	$620.00
	Medcare Taxes Expense	$145.00
	Wages Payable		$11,965.00
c.	Income Atx Expesne	$42,850.00
	Income Tax Payable		$42,850.00
d.	Account Payable	$1,262.00
	Sales Revenue		$1,214.00
	Sales Tax Payable		$48.00
e.	Socail Security Taxes Expense	$620.00
	Medicare Tax	$145.00
	Socail Security Taxes Payable		$620.00
	Medicare Tax Payable		$145.00
f.	Cash	$25,000.00
	Note Payable		$25,000.00