The following transactions occurred:

1. Purchased equipment at a cost of $10,200 on May. 1, signing a nine month 6.6% note payable for that amount.

2. Recorded a weeks sales of $36,000 on Feb. 14, two thirds on credit and one-third for cash. Sales are subject to 6 % sales tax.

3. Accrued monthly warranty expense, which is estimated at 1.2% on sales in #2.

4. Sent last weeks sales tax to the state, Feb. 19.

5. Sold 2 year service contracts on copiers for $70,000 on Feb. 28. Each month the company services the copiers. Give the journal entry for the sale of the service copiers and any adjustment journal entry on Dec. 31. (Ignore cost to service copiers).

6. Paid the nine month note, plus interest, at maturity, Nov. 1. See #1.

7. Mar. 1, the company is a party to a patent infringement lawsuit of $230,000. Their attorney is certain that the company will lose the lawsuit. Estimated cost will be $200,000.

8. Mar. 15, the company is party to a lawsuit for company violations of $90,000. The company attorney advises that it is a remote possibility that the company will lose this lawsuit. The attorney estimates the amount at $80,000, if they do.

9. Dec. 31, oil is spilled in the parking lot and is an environmental hazard which will need to be cleaned by a Hazmat team. It is certain this will need to be remediated. The company does not know how much it will cost.

Journalize the required transactions. If no journal entry is required, say no journal entry.

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