Liability Transactions

The following items were selected from among the transactions completed by $O^{\text{'}}$ Donnel $Co,$ during the current year:

Jan. $10.$ Purchased merchandise on account from Laine Co$.,$ $$144,000,$ terms $\frac{n}{30}.$

Feb. $9.$ Issued a $30-$day, $7\%$ note for $$144,000$ to Laine Co$.,$ on account.

Mar. $11.$ Paid Laine Co$,$ the amount owed on the note of February $9.$

May $1.$ Borrowed $$151,200$ from Tabata Bank, issuing a $45-$day, $8\%$ note.

June $1.$ Purchased tools by issuing a $$90,000,60-$day note to Gibala Co$.,$ which discounted the note at the rate of $6\%,$

$15.$ 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 $$151,200.($Journalize both the debit and credit to the notes payable account.$)$

July $30.$ Paid 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. $1.$ Purchased office equipment from Warick Co$.$ for $$96,000,$ paying $$16,000$ and issuing a series of ten $5\%$ notes for $$8,000$ each, coming due at $30-$day intervals,

$15.$ Settled a product liability lawsuit with a customer for $$79,000,$ payable in January. O'Donnel accrued the loss in a litigation claims payable account.

$31.$ Paid the amount due Warick Co$.$ on the first note in the series issued on December $1.$

required:

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.

June $1$

$2.$ Joumalize the adjusting entry for each of the following accrued expenses at the end the current year: $($a$)$ product warranty cost, $$15,000$ remaining notes owed to Warick Co$.$ Assume a $360-$day year. Round your answers to the nearest dollar amount.

June $15$