CHAPTER 11 HW: Q1

Liability Transactions

Liability Transactions The following items were selected from among the transactions completed by O'Donnel Co. during the current year: Jan. 10. Purchased merchandise on account from Laine Co. $144,000, terms w/30. Feb. 9. Issued a 30 day, 6% note for $144,000 to Laine Coon account. Mar. 11. Paid Laine Co the amount owed on the note of February 9. May 1. Borrowed $176,400 from Tabata Bank, issuing a 45-day, 7% note June 1. Purchased tools by issuing a $72,000, 60-day note to Gibala Co, which discounted the note at the rate of 8% 15. Paid Tabata Bank the interest due on the note of May 1 and renewed the loan by issuing a new. 45-day, 7 note for $176,400. Journalize both the debit and credit to the notes payable account) July 30. Pald Tabata Bank the amount due on the note of June 15 30. Paid Gibala Co, the amount due on the note of June 1 Dec. 1. Durchased office equipment from Warick Co. for 5120,000, paying $20,000 and issuing a series of ten 5 notes for $10,000 each coming due at 30 day intervals 15. Settled a product liability lawsuit with a customer for $65.000. pavable in January, O'Donnel accrued the loss in a litigation claims payable account. 31. Paid the amount due Warick Coon the first note in the series issued on December 1 Required: 1. Journalize the transactions. If an amount box does not require antitans 360 Doroond the Intermediate calculations and round the final answers to the nearest dollar amount Required: 1. Journalize the transactions. If an amount box does not require an entry, leave it blank. Assume a 360-day year. Don't round the intermediate . calculations and round the final answers to the nearest dollar amount For a compound transaction, accounts should be listed largest to smallest Account Date Debit Credit Jan. 10 Feb. 9 Mar. 11 1 III I May 1 May 1 June 1 June 15 III IIII III II July 30 July 30 July 30 July 30 | Ill 1 11 Dec. 1 Dec. 15 Il III DIE Dec. 31 Dec, 15 Dec. 31 2. Journalite the adjusting entry for each of the following accrued expenses at the end of the current year(s) product warranty cost $13,500 (6) interest on the nine remaining notes owed to Warick Co. Assume a 360-day year. Round your answers to the nearest dollar amount Item Account Debit Credit Check My Work 3 more Check My Workesterining Next