Question

On January 1, 2022, the ledger of Sandhill Co. contained these liability accounts.

Accounts Payable		$44,600
Sales Taxes Payable		8,700
Unearned Service Revenue		21,100

During January, the following selected transactions occurred.

Jan. 1		Borrowed $18,000 in cash from Apex Bank on a 4-month, 5%, $18,000 note.
5		Sold merchandise for cash totaling $6,360, which includes 6% sales taxes.
12		Performed services for customers who had made advance payments of $13,600. (Credit Service Revenue.)
14		Paid state treasurer’s department for sales taxes collected in December 2021, $8,700.
20		Sold 710 units of a new product on credit at $54 per unit, plus 5% sales tax.

During January, the company’s employees earned wages of $60,000. Withholdings related to these wages were $4,590 for Social Security (FICA), $5,200 for federal income tax, and $1,560 for state income tax. The company owed no money related to these earnings for federal or state unemployment tax. Assume that wages earned during January will be paid during February. No entry had been recorded for wages or payroll tax expense as of January 31.

(a)

Journalize the January transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. Round answers to nearest whole dollar amount, e.g. 5,275.)

Date	Account Titles and Explanation	Debit	Credit
choose a transaction date                                                                      Jan. 1Jan. 5Jan. 12Jan. 14Jan. 20Jan. 31	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date                                                                      Jan. 1Jan. 5Jan. 12Jan. 14Jan. 20Jan. 31	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date                                                                      Jan. 1Jan. 5Jan. 12Jan. 14Jan. 20Jan. 31	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date                                                                      Jan. 1Jan. 5Jan. 12Jan. 14Jan. 20Jan. 31	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date                                                                      Jan. 1Jan. 5Jan. 12Jan. 14Jan. 20Jan. 31	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount

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(b)

The parts of this question must be completed in order. This part will be available when you complete the part above.

(c)

The parts of this question must be completed in order. This part will be available when you complete the part above.

Answer 1

Date	Account Titles and Explanation	Debit	Credit
Jan. 1	Cash	18000
	Notes payable		18000
Jan. 5	Cash	6360
	Sales Revenue		6000	=6360/106*100
	Sales Taxes Payable		360
Jan. 12	Unearned Service Revenue	13600
	Service Revenue		13600
Jan. 14	Sales Taxes Payable	8700
	Cash		8700
Jan. 20	Accounts Receivable	40257
	Sales Revenue		38340	=710*54
	Sales Taxes Payable		1917	=38340*5%