The following items were selected from among the transactions completed by Pioneer Co. during the current year: Mar. 1. Purchased merchandise on account from Galston Co., $360,000, terms n/30. Mar. 31. Issued a 30-day, 5% note for $360,000 to Ģalston Co., on account. Apr. 30. Paid Galston Co. the amount owed on the note of March 31. June 1. Borrowed $180,000 from Pilati Bank, issuing a 45-day, 4% note. July 1. Purchased tools by issuing a $210,000, 60-day note to Zegna Co., which discounted the note at the rate of 7%. July 16. Paid Pilati Bank the interest due on the note of June 1 and renewed the loan by issuing a new 30-day, 6.5% note for $180,000. (Journalize both the debit and credit to the notes payable account.) Aug. 15. Paid Pilati Bank the amount due on the note of July 16. Aug. 30. Paid Zegna Co. the amount due on the note of July 1. Dec. 1. Purchased office equipment from Taylor Co. for $500,000, paying $120,000 and issuing a series of ten 6% notes for $38,000 each, coming due at 30-day intervals. Dec. 22. Settled a product liability lawsuit with a customer for $310,000, payable in January. Pioneer accrued the loss in a litigation claims payable account. Dec. 31. Paid the amount due Taylor Co. on the first note in the series issued on December 1. Instructions 1. Journalize the transactions. 2. Journalize the adjusting entry for each of the following accrued expenses at the end of the current year: a. Product warranty cost, $27,500.
The following items were selected from among the transactions completed by Pioneer Co. during the current year: Mar. 1. Purchased merchandise on account from Galston Co., $360,000, terms n/30. Mar. 31. Issued a 30-day, 5% note for $360,000 to Ģalston Co., on account. Apr. 30. Paid Galston Co. the amount owed on the note of March 31. June 1. Borrowed $180,000 from Pilati Bank, issuing a 45-day, 4% note. July 1. Purchased tools by issuing a $210,000, 60-day note to Zegna Co., which discounted the note at the rate of 7%. July 16. Paid Pilati Bank the interest due on the note of June 1 and renewed the loan by issuing a new 30-day, 6.5% note for $180,000. (Journalize both the debit and credit to the notes payable account.) Aug. 15. Paid Pilati Bank the amount due on the note of July 16. Aug. 30. Paid Zegna Co. the amount due on the note of July 1. Dec. 1. Purchased office equipment from Taylor Co. for $500,000, paying $120,000 and issuing a series of ten 6% notes for $38,000 each, coming due at 30-day intervals. Dec. 22. Settled a product liability lawsuit with a customer for $310,000, payable in January. Pioneer accrued the loss in a litigation claims payable account. Dec. 31. Paid the amount due Taylor Co. on the first note in the series issued on December 1. Instructions 1. Journalize the transactions. 2. Journalize the adjusting entry for each of the following accrued expenses at the end of the current year: a. Product warranty cost, $27,500.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 11RE: On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to...
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Transcribed Image Text:The following items were selected from among the transactions completed
by Pioneer Co. during the current year:
Mar. 1. Purchased merchandise on account from Galston Co., $360,000,
terms n/30.
Mar. 31. Issued a 30-day, 5% note for $360,000 to Galston Co., on account.
Apr. 30. Paid Galston Co. the amount owed on the note of March 31.
June 1. Borrowed $180,000 from Pilati Bank, issuing a 45-day, 4% note.
July 1. Purchased tools by issuing a $210,000, 60-day note to Zegna Co.,
which discounted the note at the rate of 7%.
July 16. Paid Pilati Bank the interest due on the note of June 1 and renewed
the loan by issuing a new 30-day, 6.5% note for $180,000. (Journalize both
the debit and credit to the notes payable account.)
Aug. 15. Paid Pilati Bank the amount due on the note of July 16.
Aug. 30. Paid Zegna Co. the amount due on the note of July 1.
Dec. 1. Purchased office equipment from Taylor Co. for $500,000, paying
$120,000 and issuing a series of ten 6% notes for $38,000 each, coming
due at 30-day intervals.
Dec. 22. Settled a product liability lawsuit with a customer for $310,000,
payable in January. Pioneer accrued the loss in a litigation claims payable
account.
Dec. 31. Paid the amount due Taylor Co. on the first note in the series issued
on December 1.
Instructions
1. Journalize the transactions.
2. Journalize the adjusting entry for each of the following accrued expenses
at the end of the current year:
a. Product warranty cost, $27,500.
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