Carnden Biotechnology began operations in September 2021. The following selected transactions relate to liabilities of the company for September 2021 through March 2022. Camden's fiscal year ends on December 31. Its financial statements are issued in April 2021 a. On September 5, opened checking accounts at Second Commercial Bank and negotiated a short term line of credit of up to 523,000,000 at the bank's prime rate (95% at the time). The company will pay no commitment fees. b. On October 1, borrowed $20 million cash from Second Commercial Bank under the line of credit and issued a five-month promissory note Interest at the prime rate of 9% was payable at maturity Management planned to issue 10-year bonds in February to repay the note c. Received $1,800 of refundable deposits in December for reusable containers used to transport and store chemical-based products, d. For the September-December period sales on account totaled 54740.000. The state sales tax rate is 396 and the local sales tax rate is 3% (This is a summary journal entry for the many individual sales transactions for the period) e Recorded the adjusting entry for accrued interest 2022 In March, paid the entire amount of the note on its March 1 due date, using proceeds from a February issuance of $175 million of 10 year bonds at face value along with other available cash The storage containers covered by refundable deposits are expected to be returned during the first nine months of the year Half of the containers were returned in March 2022 Required: 1. Prepare the appropriate journal entries for items -9 2. Prepare the current and long-term liability sections of the December 31, 2021 balance sheet iade accounts payable on that date were 5296.000 Complete this question by entering your answers in the tabs below. Mo Transaction General Journal No journal entry required Debit Credit 1 > 2 b Cash Notes payable 20,000,000 20,000,000 3 c Cash Liability-refundable deposits 1.800 1.800 4 d 4.882 200 Accounts receivable Sales revenue Sales taxes payable OO 4,740.000 142 200 5 Interest expense Interest payable 517500 X 517.500 6 2.1 0 Cash Bonds payable 17.500.000 17 500.000 7 42 Notes pavable Interest payable Interest expense 23.000.000 517 500 345,000 23 862 500 Labi-fundablo deposits 900 Required 1 Required 2 Prepare the current and long-term liability sections of the December 31, 2021, balance sheet. Trade acco date were $296,000. (Enter your answers in whole dollars.) Camden Biotechnology Balance Sheet (partial) At December 31, 2021 Current liabilities Accounts payable Current portion of notes payable Sales taxes payable Interest payable Liability--refundable deposits SIS 5,500,000 X 142 200 517.500 1.800 SIS $ 6.161.500 Total current liabilities Long-term liabilities Notes payable to be refinanced on a long-term basis $17.500.000
