Chuck's Landscaping Ltd. (CLL) had the following transactions involving current liabilities in its first year of operations:
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Chuck's Landscaping Ltd. (CLL) had the following transactions involving current liabilities in its first year of operations:
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1.CLL signs contracts with customers and requests 50% of the contract price as a deposit at the time of signing. CLL had three contracts totalling $185,000 in which the work had not started. 2. CLL has five employees, who earn gross wages of $420,000 for the year. From this, the company deducted 20% for income taxes, $20,790 in CPP premiums, and $6,846 in El premiums before distributing the cheques to the staff. As an employer, CLL was also required to match the employees' CPP premiums and pay $9,584 in El premiums. CLL had fallen behind in making payments owing to the government. The last two months of the year were still outstanding (that is, 2/12). 3 CLL ordered sod from one supplier during the year. The supplier provided credit to CLL, and at the end of the year CLL owed $40,500 on total purchases of $369,000. 4 CLL also sells gift cards that can be used to buy plants at the company's greenhouse. During the year, the company sold $52,000 in gift cards. (a) Prepare journal entries to record the transactions. (Enter debit entries first followed by credit entries. Credit account titles are automatically ( indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 14,674.) No. Account and explanation Debit Credia 2 (To record wages payable to employees) 1.CLL signs contracts with customers and requests 50% of the contract price as a deposit at the time of signing. CLL had three contracts totalling $185,000 in which the work had not started. 2. CLL has five employees, who earn gross wages of $420,000 for the year. From this, the company deducted 20% for income taxes, $20,790 in CPP premiums, and $6,846 in El premiums before distributing the cheques to the staff. As an employer, CLL was also required to match the employees' CPP premiums and pay $9,584 in El premiums. CLL had fallen behind in making payments owing to the government. The last two months of the year were still outstanding (that is, 2/12). 3 CLL ordered sod from one supplier during the year. The supplier provided credit to CLL, and at the end of the year CLL owed $40,500 on total purchases of $369,000. 4 CLL also sells gift cards that can be used to buy plants at the company's greenhouse. During the year, the company sold $52,000 in gift cards. (a) Prepare journal entries to record the transactions. (Enter debit entries first followed by credit entries. Credit account titles are automatically ( indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 14,674.) No. Account and explanation Debit Credia 2 (To record wages payable to employees)
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Ref 1 2 3 4 JOURNAL ENTRIES Account Titles Cash Unearned ... View the full answer
Related Book For
Understanding Financial Accounting
ISBN: 9781119406921
2nd Canadian Edition
Authors: Christopher D. Burnley
Posted Date:
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