Liability Transactions The following items were selected from among the transactions completed by Shin Co. during the current year: Jan. 10. Purchased merchandise on account from Beckham Co., $144,000, terms n/30. Feb. 9. Issued a 30-day, 8% note for $144,000 to Beckham Co., on account. Mar. 11. Paid Beckham Co. the amount owed on the note of February 9. May 1. Borrowed $169,200 from Verity Bank, issuing a 45-day, 9% note. June 1. Purchased tools by issuing a $90,000, 60-day note to Rassmuessen Co., which discounted the note at the rate of 9%. 15. Paid Verity Bank the interest due on the note of May 1 and renewed the loan by issuing a new 45-day, 7% note for $169,200. (Journalize both the debit and credit to the notes payable account.) July 30. Paid Verity Bank the amount due on the note of June 15. 30. Paid Rassmuessen Co. the amount due on the note of June 1. Dec. 1. Purchased office equipment from Lambert Co. for $108,000, paying $18,000 and issuing a series of ten 5% notes for $9,000 each, coming due at 30-day intervals. 15. Settled a product liability lawsuit with a customer for $67,000, payable in January. Shin accrued the loss in a litigation claims payable account. 31. Paid the amount due Lambert Co. on the first note in the series issued on December 1. Required: 1. Journalize the transactions. If an amount box does not require an entry, leave it blank. Assume a 360-day year. Don't round the intermediate calculations and round the final answers to the nearest dollar amount.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Liability Transactions

The following items were selected from among the transactions completed by Shin Co. during the current year:

Jan. 10.	Purchased merchandise on account from Beckham Co., $144,000, terms n/30.
Feb. 9.	Issued a 30-day, 8% note for $144,000 to Beckham Co., on account.
Mar. 11.	Paid Beckham Co. the amount owed on the note of February 9.
May 1.	Borrowed $169,200 from Verity Bank, issuing a 45-day, 9% note.
June 1.	Purchased tools by issuing a $90,000, 60-day note to Rassmuessen Co., which discounted the note at the rate of 9%.
15.	Paid Verity Bank the interest due on the note of May 1 and renewed the loan by issuing a new 45-day, 7% note for $169,200. (Journalize both the debit and credit to the notes payable account.)
July 30.	Paid Verity Bank the amount due on the note of June 15.
30.	Paid Rassmuessen Co. the amount due on the note of June 1.
Dec. 1.	Purchased office equipment from Lambert Co. for $108,000, paying $18,000 and issuing a series of ten 5% notes for $9,000 each, coming due at 30-day intervals.
15.	Settled a product liability lawsuit with a customer for $67,000, payable in January. Shin accrued the loss in a litigation claims payable account.
31.	Paid the amount due Lambert Co. on the first note in the series issued on December 1.

Required:

1. Journalize the transactions. If an amount box does not require an entry, leave it blank. Assume a 360-day year. Don't round the intermediate calculations and round the final answers to the nearest dollar amount.

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