You run a merchandising business and this is your 2nd year of operations A few of the transactions for the year are provided below Your purchase 100 units of inventory from a supplier for $20 each, 210, n30, FOB destination You purchase a computer on account, n45, for $1,500, plus HST It has an estimated useful life of 5 years and no residual value A customer has ordered a special product and provided a down payment of $500 cash You pay for your purchase in Transaction 1 within the discount period You borrow $20,000 from the bank at an interest rate of 3 for 2 years Your accountant tells you that you owe Revenue Canada $6,000 on the income from the business You have not paid any income taxes yet You pay the interest on your loan, which is due today You pay off your outstanding accounts payable You have decided that there is too much work for one person and you hire an employee at $12 per hour They have worked for you for 375 hours every week for the last 2 weeks and you pay them You determine that CPP is $44, EI is 15, and EIT is $210 You provide a special product to your customer (see transaction 3) The product has a cost of $220

Answer rating: 100% (QA)

Journal entries indicates Accounts affected and amounts involved for each transaction 1 Purchase deb... View the full answer