On January 1, 2020, the ledger of Accardo Company contains the following liability accounts.

Accounts Payable ................................  $52,000
Sales Taxes Payable ............................      7,700
Unearned Service Revenue ................   16,000

During January, the following selected transactions occurred.
Jan. 5 Sold merchandise for cash totaling $20,520, which includes 8% sales taxes.

12 Performed services for customers who had made advance payments of $10,000. (Credit Service Revenue.)

14 Paid state revenue department for sales taxes collected in December 2018 ($7,700).

20 Sold 900 units of a new product on credit at $50 per unit, plus 8% sales tax.

21 Borrowed $27,000 from Girard Bank on a 3-month, 8%, $27,000 note.

25 Sold merchandise for cash totaling $12,420, which includes 8% sales taxes.

Instructions

a. Journalize the January transactions.

b. Journalize the adjusting entry at January 31 for the outstanding note payable. (Hint: Use one-third of a month for the Girard Bank note.)

c. Prepare the current liabilities section of the balance sheet at January 31, 2020. Assume no change in accounts payable.