CP10-2 Recording and Reporting Current Liabilities with Evaluation of Effects on the Debt-to-Assets Ratio [LO 10-2, LO 10-5]

EZ Curb Company completed the following transactions. The annual accounting period ends December 31.

Jan. 8	Purchased merchandise on account at a cost of $20,000. (Assume a perpetual inventory system.)
17	Paid for the January 8 purchase.
Apr. 1	Received $49,600 from National Bank after signing a 12-month, 12.0 percent, promissory note.
June 3	Purchased merchandise on account at a cost of $24,000.
July 5	Paid for the June 3 purchase.
Aug. 1	Rented out a small office in a building owned by EZ Curb Company and collected six months rent in advance, amounting to $9,600. (Use an account called Unearned Revenue.)
Dec. 20	Collected $220 cash on account from a customer.
Dec. 31	Determined that wages of $8,900 were earned but not yet paid on December 31 (ignore payroll taxes).
Dec. 31	Adjusted the accounts at year-end, relating to interest.
Dec. 31	Adjusted the accounts at year-end, relating to rent.

1. Prepare journal entries for each of the transactions through December 20. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Import a new list 1 Record the purchase of inventory for $20,000 on account. 2 Record the payment for inventory in full 3 Record the borrowing of $49,600. 4 Record the purchase of inventory for $24,000 on account. 5 Record the payment for inventory in full 6 Record the collection of six months rent in advance Credit amounting to $9,600. 7 Record the receipt of a deposit from a customer of $220. Note journal entry has been entered Record entry Clear entry View general journal 2. Prepare any adjusting entries required on December 31. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations.) View transaction list X: Import a new list 1 Record the wages earned, but not yet paid as of December 31. Record the adjusting entry relating to interest. 2 Record the adjusting entry relating to rent. 3 Credit Note:- journal entry has been entered Clear entry Record entry View general journal