Keruing Sejahtera Bhd (KERUING) is a company dealing with health food products operating in Bukit Kayu Hitam, Kedah. The partial statement of the financial position of KERUING as at 31 December 2020 is as follows:

Current Liability                                                       RM

12% Notes payable                                                     220,000

Interest payable                                                           26,400

Premium liability                                                        11,000

Accounts payable                                                        180,000

437,400

Equity

Share capital (1,500,000 ordinary shares)                  3,300,000

Retained earnings                                                       1,400,000

4,700,000

Following are transactions related to equity and current liabilities that took place during the first quarter of 2021:

1 January         Declared a dividend of RM0.20 for each share outstanding on 31 December 2020.

1 January        KERUING settled 12% notes payable together with the total interest that have not been paid in last year by signing a new RM400,000, 8%, 5-year long term loan.

31 January      Purchased a machine for RM40,000, paying RM10,000 in cash and giving a one-year, 8% note for the balance.

21 February    Received RM20,000 in advance for RM40,000 health product ordered by Seraya Beauty Enterprise which to be delivered in March and April.

5 March           Delivered health product ordered on 21 February, worth RM15,000.

18 March         Cash sales of RM55,000.

28 March        Purchased goods from Syarikat Kempas Bhd for an invoice price of RM60,000, terms 2/10, n/30, FOB shipping point. KERUING paid freight costs of RM800. KERUING uses a periodic inventory system and the gross method of accounting for purchase discounts.

31 March        Paid gross salaries of RM180,000 to employees. Deductions from the salaries are as follows:

1. Employees’ contribution to EPF of 11% of the gross salary.

2. Zakat amounting to RM4,600.

3. Health insurance premium of RM8,400.

4. All payments to the respective departments are made on 25 April 2021.

REQUIRED:

(a)     Prepare the journal entries to record the above transactions.

(b)     Prepare the necessary adjusting entry(ies) at 31 March 2021.