Charlottetown Grocer's general ledger at June 30, 2020, the end of the company's fiscal year, includes the following account balances before adjusting entries.

The additional data needed to develop the adjusting entries at \(J\) une 30 are as follows:

a. The \(\$ 74,000\) short-term note payable was issued on July 31,2019 ; it matures one year from the date of issuance and bears interest at 5 percent.

b. The long-term debt is payable in annual instalments of \(\$ 60,000\), with the next instalment due February 28, 2021. On that date, Charlottetown Grocer will also pay one year's interest at 5.5 percent. Interest was last paid on February 28, 2020.

c. Gross salaries for the last payroll of the fiscal year were \(\$ 21,446\). Of this amount, employee withholdings were \(\$ 4,756\) and salaries payable were \(\$ 16,690\).

d. Employer payroll costs were \(\$ 2,788\), and Charlottetown Grocer's liability for employee life insurance was \(\$ 300\).

e. Charlottetown Grocer estimates that vacation pay is 6 percent of gross salaries of \(\$ 240,000\) (the \(\$ 240,000\) includes the last payroll of the fiscal year).

f. On March 1, 2020, the company collected one year's service contract revenue of \(\$ 18,000\) in advance. It will earn the revenue evenly during the year.
g. At June 30,2020 , Charlottetown Grocer is the defendant in a \(\$ 100,000\) lawsuit, which the store expects to win. However, the outcome is uncertain.
Required 1. Open T-accounts for the listed accounts, inserting their unadjusted June 30,2020 , balances.
2. Post the June 30,2020 , adjusting entries to the accounts opened. Round all amounts to the nearest whole dollar.
3. Prepare the liability section of Charlottetown Grocer's balance sheet at June 30 , 2020. Show total current liabilities and total liabilities.
4. Is there a contingent liability? If yes, write the note to describe it and indicate where it should appear.

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Note Payable, Short-Term $74,000 Employee Insurance Accounts Payable 355,680 Benefits Payable Current Portion of Estimated Vacation Long-Term Debt Payable Interest Payable Pay Liability 7,896 GST Payable 4,900 Salaries Payable Property Tax Payable 9,284 Employee Withholdings Payable Unearned Service Revenue 18,000 Employer Payroll Costs Payable Long-Term Debt Payable 300,000