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Question 3: Liabilities (11 marks) The following event took place in 2019: On 2 January, Survivor...

Question 3: Liabilities

The following event took place in 2019:

On 2 January, Survivor Ltd issued a prospectus to invite applications for 2,000 $250 6% debentures for 8 years, Interest payable half-yearly. The debentures were payable in full on application. All debentures were applied for by 31 March. Allotment took place on 15 April.

At 31 December 2019 Survivor Ltd's employees earned wages of $20,000. Payroll deductions related to these wages were $1,400 for a health fund, $1,900 for PAYG withheld tax, and $1,800 for superannuation. Assume that wages earned during December 2019 will be paid during January 2020.

Required

  1. Prepare the general journal entries to record the event on 15 April 2019.
  1. Prepare the general journal entries to record the redemption of the debentures at maturity on 16 April 2027.

  1. Prepare the adjusting journal entries to record wages expense at 31 December 2020.
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