Front Row has the following selected balances at the February 29, 2012:

The following information is not reflected in these balances:
a. On February 29, 2012, Front Row Entertainment accepted delivery of $5,325 of live- performance DVDs from their supplier. Front Row has not yet paid the supplier.
b. On February 1, Front Row Entertainment purchased $8,000 of equipment for its Chicago Music House venue by issuing a one-year note payable bearing 10 percent interest. Front Row has not made any journal entries related to this transaction and should accrue for this at month€™s end. (Note: Round any calculations to the nearest dollar.)
c. Front Row Entertainment collected $3,745 of advance ticket sales related to an upcoming concert. This price included 7 percent state sales tax.
d. Amanda Wilson was paid $2,000 in wages to update and monitor the online fan communities. Federal and state unemployment taxes are $16 and $108, respectively. Amanda is below the Social Security minimum. In addition, $375 of income taxes were withheld. In addition, several individuals were injured during a concert in February when they pushed past security and rushed the stage. A personal injury lawsuit was filed against Front Row Entertainment in the amount of $250,000. After investigating the incident and consultation with legal counsel, it was determined that the likelihood of a judgment against Front Row was remote.
Required:
1. Prepare the necessary journal entries for a through d (Note: Round all calculations to the nearest dollar).
2. Determine the current ratio before and after the additional information.
3. How should this contingent event be recorded?

Account Debit Credit 12,480 3,900 20,380 31,000 Cash Accounts receivable Inventory Other current assets Accounts payable Interest payable Sales taxes payab Unearned sales revenue Other current liabilities $8,640 375 1,200 26,100 8,300