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The following transactions apply to Walnut Enterprises for Year 1, its first year of operations: 1. Received $50,000 cash from the issue of a short-term
The following transactions apply to Walnut Enterprises for Year 1, its first year of operations: 1. Received $50,000 cash from the issue of a short-term note with a 6 percent interest rate and a one-year maturity. The note was made on April 1, Year 1. 2. Received $130,000 cash plus applicable sales tax from performing services. The services are subject to a sales tax rate of 6 percent 3. Paid $62,000 cash for other operating expenses during the year 4. Paid the sales tax due on $110.000 of the service revenue for the year. Sales tax on the balance of the revenue is not due until Year 2 5. Recognized the accrued interest at December 31, Year 1 The following transactions apply to Walnut Enterprises for Year 2 1. Paid the balance of the sales tax due for Year 1 2. Received $201.000 cash plus applicable sales tax from performing services. The services are subject to a sales tax rate of 6 percent 3. Repaid the principal of the note and applicable interest on April 1 Year 2 4. Paid $102,500 of other operating expenses during the year 5. Paid the sales tax due on $185,000 of the service revenue The sales tax on the balance of the revenue is not due until Year 3 Journal entry worksheet Received $50,000 cash from the issue of a short-term note with a 6 percent interest rate and a one-year maturity. The note was made on April 1, Year 1. Note: Enter debits before credits. Event General Journal Debit Credit 1 Journal entry worksheet
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