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13 June, 13:03

Recording known current liabilities C2 1. On July 15, Piper Co. sold $10,000 of merchandise (costing $5,000) for cash. The sales tax rate is 4%. On August 1, Piper sent the sales tax collected from the sale to the government. Record entries for the July 15 and August 1 transactions. 2. On November 3, the Milwaukee Bucks sold a six-game pack of advance tickets for $300 cash. On November 20, the Bucks played the first game of the six-game pack (this represented one-sixth of the advance ticket sales). Record the entries for the November 3 and November 20 transactions

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  1. 13 June, 13:33
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    The Journal entries are as follows:

    1.

    (a) On July 15,

    (i) Cash A/c Dr. $10,400

    To sales $10,000

    To sales tax payable $400

    (To record sales)

    (ii) Cost of goods sold A/c Dr. $5,000

    To Inventory A/c $5,000

    (To record cost of goods sold)

    (b) On August 1,

    Sales tax payable A/c Dr. $400

    To cash $400

    (To record payment of sales tax)

    2.

    (i) On November 3,

    cash A/c Dr. $300

    To Unearned ticket revenue $300

    (To record revenue)

    (ii) On November 20,

    Unearned ticket revenue A/c Dr. $50

    To ticket revenue $50

    (To record adjusting entry)
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