Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

REVIEW PROBLEM 12-1 The following selected transactions and events of Oakland Ltd. were completed during the accounting year just ended, JI December 20X5. Interest rates

image text in transcribed
image text in transcribed
REVIEW PROBLEM 12-1 The following selected transactions and events of Oakland Ltd. were completed during the accounting year just ended, JI December 20X5. Interest rates reflect market rates unless indicated. Page 166 a. On June, the company borrowed $55,000 in cash from the bank on a demand basis. The interest rate was 6%, to be paid on the anniversary date of the loan. b. Merchandise was purchased on account; a $30,000. one year, 7% interest-bearing note, dated 1 April 20X5, was given to the supplier. Interest is paid when the amount is due on 1 April 20X6. c. Merchandise was purchased on account: a two-year. $16.000, 15 note dated 1 February 20Xs was given to the supplier. Interest is due annually on 1 February. The going interest rate for this term and risk was 7%. Use the gross method to record the note payable. d. A supplier delivered goods on account costing US$20.000. The exchange rate was USSI - Can50.98 at that time. e. Oakland has been sued by a customer for $500.000. The legal team confidently believes that there is an 80% chance that Oakland will successfully defend itself f. New legislative requirements came into force at the beginning of this year regarding environmental remediation Oakland believes it will have to pay $80.000 in eight years' time when the company vacates leased premises. The going interest rate fog this term and risk was 7% B. Payroll records showed the following. Amounts are unpaid: Employee Employee Gross Wages $120.000 Income Tax EI CPP Union Does $32.000 $6,100 $5.500 $2.500 h. The employer portion of El and CPP are recorded. i. Remittances were income tax, $31.350, EL, $10,250, CPP. 59.720, union dues. $1,450 J. Cash dividends declared but not yet paid were $22.500. k Accrue appropriate interest at 31 December, and adjust the foreign denominated payable to the yearend rate. USSI - Cdn50.96 Required: 1. Give the entry or entries for each of the above transactions and evegts, if needed. 2. Prepare a list (title and amount of the liabilities of Oakland at 31 December 20X5 PET

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_2

Step: 3

blur-text-image_3

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

A Biodiversity Audit For Lotopue Mangrove Forests

Authors: Sapa Saifaleupolu, Fiu Mataese Elisara

1st Edition

6200288674, 978-6200288677

More Books

Students also viewed these Accounting questions

Question

Organizing Your Speech Points

Answered: 1 week ago