Problem 10-1A

On January 1, 2017, the ledger of Accardo Company contains the following liability accounts.

Accounts Payable		$51,700
Sales Taxes Payable		8,900
Unearned Service Revenue		16,200

During January, the following selected transactions occurred.

Jan. 5		Sold merchandise for cash totaling $20,520, which includes 8% sales taxes.
12		Performed services for customers who had made advance payments of $10,500. (Credit Service Revenue.)
14		Paid state revenue department for sales taxes collected in December 2016 ($8,900).
20		Sold 910 units of a new product on credit at $50 per unit, plus 8% sales tax.
21		Borrowed $29,250 from Girard Bank on a 3-month, 8%, $29,250 note.
25		Sold merchandise for cash totaling $12,420, which includes 8% sales taxes. a. Journalize the January transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) list of usable accounts: Accounts Payable Accounts Receivable Accumulated Depreciation-Equipment Bonds Payable Cash Common Stock Cost of Goods Sold Depreciation Expense Discount on Bonds Payable Equipment Federal Income Taxes Payable Federal Uemployment Taxes Payable FICA Taxes Payable Gain on Bond Redemption Income Tax Expense Income Tax Payable Insurance Expense Interest Expense Interest Payable Inventory Lease Liability Loss on Bond Redemption Mortgage Payable Notes Payable Notes Receivable Other Operating Expenses Paid-in Capital in Excess of Par-Common Stock Payroll Tax Expense Preferred Stock Premium on Bonds Payable Prepaid Insurance Retained Earnings Salaries and Wages Expense Salaries and Wages Payable Sales Revenue Sales Taxes Payable Service Revenue State Income Taxes Payable State Unemployment Taxes Payable Subscription Revenue Ticket Revenue Unearned Service Revenue Unearned Subscription Revenue Unearned Ticket Revenue b. Journalize the adjusting entry at January 31 for the outstanding notes payable. (Hint: Use one-third of a month for the Girard Bank note.) (Credit account titles are automatically indented when amount is entered. Do not indent manually.) c. Prepare the current liabilities section of the balance sheet at January 31, 2017. Assume no change in accounts payable. list of accounts: Accounts Payable Accounts Receivable Accumulated Depreciation-Equipment Bonds Payable Cash Common Stock Cost of Goods Sold Depreciation Expense Discount on Bonds Payable Equipment Federal Income Taxes Payable Federal Uemployment Taxes Payable FICA Taxes Payable Gain on Bond Redemption Income Tax Expense Income Tax Payable Insurance Expense Interest Expense Interest Payable Inventory Lease Liability Loss on Bond Redemption Mortgage Payable Notes Payable Notes Receivable Other Operating Expenses Paid-in Capital in Excess of Par-Common Stock Payroll Tax Expense Preferred Stock Premium on Bonds Payable Prepaid Insurance Retained Earnings Salaries and Wages Expense Salaries and Wages Payable Sales Revenue Sales Taxes Payable Service Revenue State Income Taxes Payable State Unemployment Taxes Payable Subscription Revenue Ticket Revenue Unearned Service Revenue Unearned Subscription Revenue Unearned Ticket Revenue