Front Row has the following selected balances at the February 28, 2020:
The following information is not reflected in these balances:
a. On February 28, 2020, Front Row accepted delivery of $5,325 of live-performance DVDs from the supplier. Front Row has not yet paid the supplier.
b. On February 1, Front Row purchased $8,000 of equipment for its Chicago Music House venue by issuing a 1-year note payable bearing 10% interest. Front Row has not made any journal entries related to this transaction and should accrue for this at month's end.
c. Front Row collected $3,745 of advance ticket sales related to an upcoming concert. This price included 7% state sales tax.
d. Amanda Wilson was paid $2,000 in wages to update and monitor the online fan communities. Federal and state unemployment taxes are $16 and $108, respectively. All of Amanda's wages are subject to Social Security and Medicare at the normal rates. In addition, $375 of federal income taxes were withheld. (Note: Round any calculations to the nearest dollar.) In addition, several individuals were injured during a concert in February when they pushed past security and rushed the stage. A personal injury lawsuit was filed against Front Row in the amount of $250,000. After investigating the incident and consultation with legal counsel, it was determined that the likelihood of a judgment against Front Row is remote.
Required:
1. Prepare the necessary journal entries for Transactions a through d.
2. Determine the current ratio before and after the additional information (round to 2 decimal places).
3. How should this contingent event be recorded?