Crane Company is a retailer operating in the province of Ontario, where HST is 13%. Crane uses a periodic inventory system and the earnings approach to revenue recognition. Transactions for the business are shown below: Nov. 1 Paid November store rent to the landlord. The lease calls for monthly payments of $5,400. 4 6 7 12 30 Purchased merchandise for resale on account from Comet Industries. The merchandise cost $7,300 plus applicable tax. Returned $800 of merchandise to Comet Industries. Sold merchandise on account to Solar Star Company for $9,000, plus applicable sales taxes, terms, n/30, FOB shipping point. The merchandise was shipped to Solar Star. The cost of the merchandise to Crane was $5,300. Purchased a new laptop computer at Staples for the marketing manager. The price of the laptop was $1,500 before applicable taxes. Paid the quarterly remittance of HST to the Receiver General. The balances in the accounts were as follows: HST Payable $2,560 and HST Recoverable $990. Prepare the journal entries to record these transactions on the books of Crane Company. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
Crane Company is a retailer operating in the province of Ontario, where HST is 13%. Crane uses a periodic inventory system and the earnings approach to revenue recognition. Transactions for the business are shown below: Nov. 1 Paid November store rent to the landlord. The lease calls for monthly payments of $5,400. 4 6 7 12 30 Purchased merchandise for resale on account from Comet Industries. The merchandise cost $7,300 plus applicable tax. Returned $800 of merchandise to Comet Industries. Sold merchandise on account to Solar Star Company for $9,000, plus applicable sales taxes, terms, n/30, FOB shipping point. The merchandise was shipped to Solar Star. The cost of the merchandise to Crane was $5,300. Purchased a new laptop computer at Staples for the marketing manager. The price of the laptop was $1,500 before applicable taxes. Paid the quarterly remittance of HST to the Receiver General. The balances in the accounts were as follows: HST Payable $2,560 and HST Recoverable $990. Prepare the journal entries to record these transactions on the books of Crane Company. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Crane Company is a retailer operating in the province of Ontario, where HST is 13%. Crane uses a periodic inventory system and the
earnings approach to revenue recognition. Transactions for the business are shown below:
Nov. 1 Paid November store rent to the landlord. The lease calls for monthly payments of $5,400.
4
6
7
12
30
Purchased merchandise for resale on account from Comet Industries. The merchandise cost $7,300 plus applicable
tax.
Returned $800 of merchandise to Comet Industries.
Sold merchandise on account to Solar Star Company for $9,000, plus applicable sales taxes, terms, n/30, FOB
shipping point. The merchandise was shipped to Solar Star. The cost of the merchandise to Crane was $5,300.
Purchased a new laptop computer at Staples for the marketing manager. The price of the laptop was $1,500 before
applicable taxes.
Paid the quarterly remittance of HST to the Receiver General. The balances in the accounts were as follows: HST
Payable $2,560 and HST Recoverable $990.
Prepare the journal entries to record these transactions on the books of Crane Company. (Record journal entries in the order presented in
the problem. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before
credit entries.)
Date
Account Titles
Debit
Credit
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