The following items were selected from among the transactions completed by ODonnel Co. during the current year:

Jan.	10.	Purchased merchandise on account from Laine Co., $396,000, terms n/30.
Feb.	9.	Issued a 30-day, 4% note for $396,000 to Laine Co., on account.
Mar.	11.	Paid Laine Co. the amount owed on the note of February 9.
May	1.	Borrowed $174,000 from Tabata Bank, issuing a 45-day, 4% note.
June	1.	Purchased tools by issuing a $258,000, 60-day note to Gibala Co., which discounted the note at the rate of 7%.
	15.	Paid Tabata Bank the interest due on the note of May 1 and renewed the loan by issuing a new 45-day, 6.5% note for $174,000. (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 $400,000, paying $114,000 and issuing a series of ten 4% notes for $28,600 each, coming due at 30-day intervals.
	15.	Settled a product liability lawsuit with a customer for 311,500, payable in January. ODonnel 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:

1.

Journalize the transactions. Refer to the Chart of Accounts for exact wording of account titles. Assume a 360-day year. Round your answers to the nearest dollar.

2.

Journalize the adjusting entry for each of the following accrued expenses at the end of the current year:

A.	Product warranty cost, $28,000.
B.	Interest on the nine remaining notes owed to Warick Co.
	Refer to the Chart of Accounts for exact wording of account titles. Assume a 360-day year. Round your answers to the nearest dollar.

Journal

1. Journalize the transactions. Refer to the Chart of Accounts for exact wording of account titles. Assume a 360-day year. Scroll down to access page 12 of the journal. Round your answers to the nearest dollar.

PAGE 11

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
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2.

Journalize the adjusting entry for each of the following accrued expenses at the end of the current year (refer to the Chart of Accounts for exact wording of account titles):

A.	Product warranty cost, $28,000.
B.	Interest on the nine remaining notes owed to Warick Co. Assume a 360-day year.

PAGE 12

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1		Adjusting Entries
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