Jintao Ltd. incurred the following transactions related to current liabilities:
1. Jintao's cash register showed the following totals at the end of the day on April 10: pre-tax sales $25,000; GST $1,250; and PST $1,750.
2. Jintao received its property tax bill for the calendar year for $26,400 on May 1, payable July 1.
3. Jintao's gross payroll for the week of August 15 was $40,500. The company deducted $2,005 for CPP, $721 for EI, $3,200 for pension, and $8,010 for income tax from the employees' pay. Jintao's payroll costs for the week were $2,005 for CPP and $1,009 for EI.
4. On November 1, Jintao borrowed $50,000 from First Bank for a six-month period; 4% interest on the bank loan is payable the first of each month.
Instructions
(a) Record the above transactions.
(b) Assuming that Jintao's year end is December 31 and that it makes adjusting entries annually, prepare any adjusting entries required for the property tax in transaction 2 and the interest in transaction 4.