Logan's Roadhouse opened a new restaurant in November. During its first two months of operation, the restaurant sold gift cards in various amounts totaling $1,750. The cards are redeemable for meals within one year of the purchase date. Gift cards totaling $636 were presented for redemption during the first two months of operation prior to year-end on December 31. The sales tax rate on restaurant sales is 6%, assessed at the time meals (not gift cards) are purchased. Logan's will remit sales taxes in January. Required: 1. & 2. Record (in summary form) the $1,750 in gift cards sold (keeping in mind that, in actuality, each sale of a gift card or a meal would be recorded individually) and the $636 in gift cards redeemed. (Hint The $636 includes a 6% sales tax of $36) 3. Determine the balance in the Deferred Revenue account (remaining liability for gift cards) to be reported on the December 31 balance sheet

Logan's Roadhouse opened a new restaurant in November. During its first two months of operation, the restaurant sold gift cards in various amounts totaling $1,750. The cards are redeemable for meals within one year of the purchase date. Gift cards totaling $636 were presented for redemption during the first two months of operation prior to year-end on December 31. The sales tax rate on restaurant sales is 6%, assessed at the time meals (not gift cards) are purchased. Logan's will remit sales taxes in January. Required: 1. & 2. Record (in summary form) the $1,750 in gift cards sold (keeping in mind that, in actuality, each sale of a gift card or a meal would be recorded individually) and the $636 in gift cards redeemed. (Hint The $636 includes a 6% sales tax of $36) 3. Determine the balance in the Deferred Revenue account (remaining liability for gift cards) to be reported on the December 31 balance sheet

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Splish Brothers Inc. sells office equipment and supplies to many organizations in the city and surrounding area on contract terms of 2/10, n/30. In the past, over 75% of the credit customers have taken advantage of the discount by paying within 10 days of the invoice date. The number of customers taking the full 30 days to pay has increased within the last year. Current indications are that less than 60% of the customers are now taking the discount. Bad debts as a percentage of gross credit sales have risen from the 2.5% average in past years to about 4.7% in the current year. The company's Finance Committee has requested more information on the collections of accounts receivable. The controller responded to this request with the following report. Proportion of Total 60% 22% (b1) 9% 5% 214% 13% Age Categories not yet due less than 30 days past due 30 to 60 days past due 61 to 120 days past due 121 to 180 days past due over 180 days past due Probability of Collection 98% 96% Additional…
Stork Enterprises delivers care packages for special occasions. They charge $45 for a small package, and $80 for a large package. The sales tax rate is 6%. During the month of May, Stork delivers 38 small packages and 22 large packages. PLEASE NOTE: All dollar amounts will be rounded to two decimal places using "$" with commas as needed (i.e. $12,345). What is the total tax charged to the customer per small package? $2.70 What is the overall charge per small package? $47.70 What is the total tax charged to the customer per large package? $4.80 What is the overall charge per large package? __________ How much sales tax liability does Stork Enterprises have for the month of May? __________
Royall Company purchased a delivery truck at $25,000 plus 8% sales taxes. Royall paid $3,000 in cash and financed the rest at 6% requiring 40 equal monthly payments at the end of each month. Compute the amount of the monthly payment that Royall must pay.
A restaurant granted a 25% discount to senior citizens in excess of the 20% mandatory requirement. During the year, the restaurant reported receipts of P108,000 from senior citizen customers.Compute the deduction for senior citizens’ discount
Bavarian Bar and Grill opened for business in November 2021. During its first two months of operation, the restaurant sold gift cards in various amounts totaling $7,600, mostly as Christmas presents. They are redeemable for meals within two years of the purchase date, although experience within the industry indicates that 90% of gift cards are redeemed within one year. Gift cards totaling $2,500 were presented for redemption during 2021 for meals having a total price of $2,900. The sales tax rate on restaurant sales is 4%, assessed at the time meals (not gift cards) are purchased. Sales taxes will be remitted in January.Required:1. Prepare the appropriate journal entries (in summary form) for the gift cards and meals sold during 2021 (keeping in mind that, in actuality, each sale of a gift card or a meal would be recorded individually).2. Determine the liability for gift cards to be reported on the December 31, 2021, balance sheet.3. What is the appropriate classification (current or…
Cobb Baseball Bats sold 45 bats for $50 each, plus an additional state sales tax of 6%. The customer paid cash.Required:Prepare the journal entry to record the sale.
The Continental Bank made a loan of $ 24 comma 000.00 on March 10 to Dr. Hirsch to purchase equipment for her office. The loan was secured by a demand loan subject to a variable rate of interest that was 5% on March 10. The rate of interest was raised to 5.25% effective July 1 and to 5.75% effective September 1. Dr. Hirsch made partial payments on the loan as follows: $1000 on May 24; $700 on June 28; and $300 on October 22. Each payment is first applied to any accumulated interest. Any remainder is then used to reduce the outstanding principal. The terms of the note require payment on October 31 of any interest not paid off by partial payments. How much must Dr. Hirsch pay on October 31 ? Question content area bottom Part 1 Dr. Hirsch must pay $ enter your response here on October 31. (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
Restaurant A serves lunch and dinner. It is open 5 days a week all year long. The total revenue for the past year was $1,000,000. The manager of Matt's Deli estimates that 52% of its revenue is provided by lunch service and the remainder by dinner service. Matt's has 50 seats, with a seat turnover rate of 7.3 for lunch and 4.8 for dinner. Determine the average check per meal for lunch. Select one: a. $237 b. $653 c. None of the available choices d. $333
The accountant for Eastern Appliances manages the “no money down” arrangements offered to its customers. A customer purchased a refrigerator normally priced at $1,284.53 with all taxes included. Using a required rate of return of 9% compounded quarterly, the accountant determined that, after a deferral period, the customer should make 12 monthly payments of $119.16, with the first payment due on November 1, 2020. On what date was the refrigerator purchased?