Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I need the answer as soon as possible Betty Bottom commenced a business called Friends of Earth, which sellscco friendly home and garden products and

I need the answer as soon as possible image text in transcribed

Betty Bottom commenced a business called Friends of Earth, which sellscco friendly home and garden products and provides consulting on sustainable living. The business has been registered for GST. GST rate is 7%. The following transactions pertain to her business for the first month of soperation. The business uses perpetual inventory system Jan " Betty Bottom deposited $20,000 cash into the business bank account. pad Obtained a medium term loan from the Bank amounting to $100,000, Jit Paid six months' rent $15000 plus GST 4" Bought 2001) water efficient showerheads at S45 (Excluded GST) cach from W.Waterman on credit. The supplier's credit terms are 2/15, 1:45. so Purchased office furniture for $19.260 (Included GST). go Retured 100 showerheads to W.Waterman due to minor defects in packaging IT Sold 100 water efficient showerheads at $85 plus GST each to Wilson Prom Ltd on credit. The credit forms are 1/10,6:30. 13* Wilson Prom Ltd returned 10 showerheads due to an error in the order 17" Paid W.Waterman Ltd the total amount owed. 19" Received $12.600 plus GST from a client, Star Express, as an advance payment for consulting work 20+ Received payment from Wilson Prom Lad for the total amount due. 27+ Received the telephone bill for the month of Janunry S65 plus GST. Payment is due by the 15h of February. The business has a policy of making payments no sooner than the due date 28 Drawings by owner $1000 Additional information The bank loan attracts an annual interest rate of 12% and only the interest needs to be paid during the first your Next interest payment is due on the 31" of March as interest is paid every 3 months Rent expense for the month is $2500. Office cleaning expense for January is unpaid and unrecorded 550(Included GST). Betty Bottom pays for office cleaning in the second week of following month. Office furniture is depreciated at 20% per annum. . Only 20% of the consulting work for Star Express has been completed by the 31" of January A physical inventory count taken on 31 January showed 1805 showerheads in stock . Required a) Prepare the journal entries to record each transaction (narrations not required) b) Record any adjusting entries necessary to prepare financial statements for January (narrations not required)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Texts And Cases

Authors: Robert Anthony, David Hawkins, Kenneth A. Merchant

12th Edition

0073100919, 978-0073100913

More Books

Students also viewed these Accounting questions