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PLEASE HELP David's Musicis a store that buys and sells musical instruments in Ontario, where the HST rate is 13%. David's Music uses a perpetual
PLEASE HELP
David's Musicis a store that buys and sells musical instruments in Ontario, where the HST rate is 13%. David's Music uses a perpetual inventory system and the earnings approach to revenue recognition. Transactions for the business are shown below: Nov. 2 Purchased 3 electric guitars from Fender Supply Limited, on account, at a cost of $900 each. 4 Made a cash sale of 2 keyboards for a total invoice price of $2.400 plus applicable taxes. The cost of each keyboard was $550. 5 Received a credit memorandum from Western Acoustic inc. for the return of an acoustic guitar that was defective. The original invoice price before taves was $800 and the guitar had been purchased on account. David's Music intends to return the defective guitar to the original supplier. 7 One of the keyboards from the cash sale of November 4 was returned to the store for a full cash refund because the customer was not satisfied with the instrument. The keyboard, which cost $550, was returned to inventory. 8 Purchased supplies from a stationery store. The price of the supplies is $400 before all applicable taxes. 10 Sold one Omega trumpet to Regional Band, on account, for an invoice price of 54.800 before applicable taxes. The trumpet had cost David's Music $2,900. 13 Purchased two saxophones from Yamaha Canada Incon account. The invoice price was $1,600 for each saxophone. excluding applicable taxes. 14 Collected $3,850 on account. The payment included all applicable taxes. 16 Returned to Yamaha Canada Inc. one of the saxophones purchased on November 13 , as it was the wrong model. Received a credit memorandum from Yamaha for the full purchase price. 20 Made a payment on account for the amount owing to Fender Supply Limited for the purchase of November 2 1 Step by Step Solution
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