After several months of planning, Magda Durocher & Martin Paquette started a business called Good living. They
Question:
After several months of planning, Magda Durocher & Martin Paquette started a business called “Good living”. They decided to split the business results as followed : 85% for Magda, 15% for Martin. Here are the first month activities (April 1-30, 2021) Note : calculate taxes when specifically required. If there is no mention of taxes, don’t calculate it.
1) Purchased supplies on credit, $890 (taxable transaction)
2) April.01: purchased a machinery, $17,875 on credit (NO taxable transaction). It should be used for 12 years and residual value is estimated at 3,400$. Declining balance method
3) Sales on credit $1,280 (taxable transaction)
4) Magda deposited $4,000 cash & Martin deposited $1,000 cash in the business bank account
5) Create Petty cash 300$
6) Sales on credit $330 to Mr. Hébert (NO taxable transaction)
7) Salary payment to employee (13$/hr, 125 hr/month).
Please note Fed tax on salary = 115$ and Prov tax on salary =130$. Please note these taxes are different than GST and QST
8) Magda withdraw 500$
9) We feel there is a risk of no payment from Mr. Hébert
10)Pay employee social charge to government (which excludes the provincial & federal tax payable)
11)20$ was used for birthday cake
12)Received 600$ from a customer (product to be shipped next month)
13)Refill petty cash
14)Pay organization social charge to government
15)Record any missing journal entries Perform April accounting cycle which includes: all necessary journal entries
Expert Answer:
Answer 1 Purchased supplies on credit 890 taxable transaction DateAccountDebitCredit 412021Accounts ... View the full answer
