Modern Electronics Company purchases merchandise inventory from several suppliers. On April 1, 2023, Modern Electronics purchased from Speedy Supplies $120,000 of inventory on account. On May 15, 2023, Modern Electronics sold inventory to a Jones Apartment Complex for $110,000 cash, which included $90,000 COGS for the inventory. On June 15, 2023 Modern Electronics remitted the applicable PST and GST or HST. Use the PST, GST, and HST rates in Exhibit 10.6.

 

Required:
Journalize Modern Electronics Company transactions on April 1, 2023, May 15, 2023, and June 15, 2023, including applicable PST and GST or HST assuming it is located in:

1. Ontario
2. British Columbia
3. Alberta

Part a. Modern Electronics is located in Ontario

• 1 Record the purchase of inventory on credit plus applicable ITC.

   

• 2

  Record the cash sales plus applicable Sales tax.

   

• 3

  Record the cost of sales.

   

• 4

  Record the refund of applicable Sales tax from Receiver General for Canada.

   

• Part b. Modern Electronics is located in British Columbia

• 
  

  • 1 Record the purchase of inventory on credit plus applicable ITC.

     

  • 2

    Record the cash sales plus applicable Sales tax.

     

  • 3

    Record the cost of sales.

     

  • 4

    Record the refund of applicable Sales tax from Receiver General for Canada.

     

  • 5

    Record the remittance of PST to provincial authority—BC Ministry of Finance.

     

  • Part c. Modern Electronics is located in Alberta

    • 1 Record the purchase of inventory on credit plus applicable ITC.

       

    • 2

      Record the cash sales plus applicable Sales tax.

       

    • 3

      Record the cost of sales.

       

    • 4

      Record the refund of applicable Sales tax from Receiver General for Canada.

    • 

Transcribed Image Text:

EXHIBIT 10.6 Sales Tax Rates, Effective January 1, 2021 Regions with GST Only Alberta....... Northwest Territories........ Nunavut............ Yukon......... Regions with GST and PST British Columbia............. Manitoba............ Quebec........... Saskatchewan..... Regions with HST New Brunswick......... Newfoundland and Labrador........ Nova Scotia........... Ontario........... PST Rate GST Rate -0- фффф -0- 5% -0- 5% -0- 5% 5% 7% 5% 7%** 5% 9.975% 5% 6% 5% | | | | HST Rate* |||| 15% 15% 15% 13% 15% Prince Edward Island................ *A Harmonized Sales Tax (HST) is applied in place of PST and GST. HST is the combination of the PST with the GST for a total sales tax. For example, for both New Brunswick and Ontario the PST rate of 8% is combined with the GST of 5%, resulting in an overall HST of 13%.. **Referred to as Retail Sales Tax (RST). EXHIBIT 10.6 Sales Tax Rates, Effective January 1, 2021 Regions with GST Only Alberta....... Northwest Territories........ Nunavut............ Yukon......... Regions with GST and PST British Columbia............. Manitoba............ Quebec........... Saskatchewan..... Regions with HST New Brunswick......... Newfoundland and Labrador........ Nova Scotia........... Ontario........... PST Rate GST Rate -0- фффф -0- 5% -0- 5% -0- 5% 5% 7% 5% 7%** 5% 9.975% 5% 6% 5% | | | | HST Rate* |||| 15% 15% 15% 13% 15% Prince Edward Island................ *A Harmonized Sales Tax (HST) is applied in place of PST and GST. HST is the combination of the PST with the GST for a total sales tax. For example, for both New Brunswick and Ontario the PST rate of 8% is combined with the GST of 5%, resulting in an overall HST of 13%.. **Referred to as Retail Sales Tax (RST).

Answer rating: 100% (QA)

Part a Modern Electronics is located in Ontario April 1 2023 Purchase of inventory on credit from Speedy Supplies Inventory Dr 120000 Accounts Payable ... View the full answer