Assume that McKinley Electronics completed these selected transactions during June 2010: a. Sales of $2,200,000 are subject

Question:

Assume that McKinley Electronics completed these selected transactions during June 2010:
a. Sales of $2,200,000 are subject to estimated warranty cost of 7%. The estimated warranty payable at the beginning of the year was $34,000, and warranty payments for the year totaled $50,000.
b. On June 1, McKinley Electronics signed a $55,000 note payable that requires annual payments of $13,750 plus 6% interest on the unpaid balance each June 2.
c. Music For You, Inc., a chain of music stores, ordered $125,000 worth of CD players. With its order, Music for You, Inc., sent a check for $125,000 in advance, and McKinley shipped $70,000 of the goods. McKinley will ship the remainder of the goods on July 3, 2010.
d. The June payroll of $260,000 is subject to employee withheld income tax of $30,000 and FICA tax of 7.65%. On June 30, McKinley pays employees their take-home pay and accrues all tax amounts.

Requirement
1. Report these items on McKinley Electronics at June 30, 2010.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...