Triton Company is a retailer operating in the province of Manitoba, where the PST rate is 7%.
Question:
Triton Company is a retailer operating in the province of Manitoba, where the PST rate is 7%. Triton uses a periodic inventory system and the earnings approach to revenue recognition. Transactions for the business are shown below:
Nov. 1 Paid November store rent to the landlord. The lease calls for monthly payments of $5,500 plus 5% GST.
4 Purchased merchandise for resale on account from Comet Industries. The merchandise cost $8,000 plus applicable tax.
6 Returned $500 of merchandise to Comet Industries.
7 Sold merchandise on account to Solar Star Company for $10,000, plus applicable sales taxes, terms, n/30, FOB shipping point. The merchandise was shipped to Solar Star. The cost of the merchandise to Triton was $6,000.
12 Purchased a new laptop computer at Staples for the marketing manager. The price of the laptop was $1,200 before applicable taxes.
30 Paid the quarterly remittance of GST to the Receiver General. The balances in the accounts were as follows: GST Payable $2,520 and GST Recoverable $985.
Instructions
Prepare the journal entries to record these transactions on the books of Triton Company.
Step by Step Answer:
Accounting Principles Volume 2
ISBN: 9781119786634
9th Canadian Edition
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak