Following are the information on some transactions of Saint-Germain Ltd. in Paris, France, in 2019 (currency in EU euro, €): A. Pre-tax cash sales on April 2 totaled €256,000. The VAT rate is 20%. B. The annual property tax bill for 2019 of €12,000 is received on May 1. The property tax is paid in full on June 30 and is to be adjusted for accrued expense at year end. Saint-Germain has a calendar year end for its accounting and records adjusting entries annually. C. Saint-Germain’s gross salary amounts to €10,000 for the week ended July 11. Amounts deducted from the employees’ salaries are pension contribution of €495, employment insurance of €178, income tax of €3,465, and health insurance of €950. On July 11, cash is paid to the employees, less the payroll deduction amounts withheld. D. Accrued interest on December 31 (the company’s yearend) for a three-month, 6%, €10,000 bank loan effective December 1. Interest is payable on the first of each month. E. In November 2019, a customer sued Saint-Germain for €10,000. Discussions with legal counsel reveal that the claim is without merit and that it is unlikely that damages will be awarded to the plaintiff. Instructions: Prepare the journal entries for Saint-Germain to record the transactions above.
Following are the information on some transactions of Saint-Germain Ltd. in Paris, France, in 2019 (currency in EU euro, €):
A. Pre-tax cash sales on April 2 totaled €256,000. The VAT rate is 20%.
B. The annual property tax bill for 2019 of €12,000 is received on May 1. The property tax is paid in full on June 30 and is to be adjusted for accrued expense at year end. Saint-Germain has a calendar year end for its accounting and records
C. Saint-Germain’s gross salary amounts to €10,000 for the week ended July 11. Amounts deducted from the employees’ salaries are pension contribution of €495, employment insurance of €178, income tax of €3,465, and health insurance of €950. On July 11, cash is paid to the employees, less the payroll deduction amounts withheld.
D. Accrued interest on December 31 (the company’s yearend) for a three-month, 6%, €10,000 bank loan effective December 1. Interest is payable on the first of each month.
E. In November 2019, a customer sued Saint-Germain for €10,000. Discussions with legal counsel reveal that the claim is without merit and that it is unlikely that damages will be awarded to the plaintiff.
Instructions: Prepare the
above.
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