Question

During October 2020 Juliana engaged in the following transactions: 01 Oct Negotiated a line of credit with their bank to replace the bank overdraft for Juliana Limited has an October 31 year e 05-Oct Provided services on which they had previously received a deposit. The balance is due in 30 days. 52,250 On October 1, 2020 Juliana had the follo Value of sale current liabilities listed on its books: 31,500 Previous deposit Bankoverdraft 12,000 24,000 12-Oct Bought inventory on credit, terms of 30 days, for: Accounts payable 112,500 20,000 15-Oct Paid amounts due the Government of Canada for the payroll amounts outstanding from September 30. El payable CPP payable 1,000 20-Oct Paid amount owing to a supplier of: 2,000 85,600 Income taxes payable 5,620 21-Oct Received payment from a client for work that will be performed in January 2021. Payment was: 5,000 Unearned revenues 12,000 22-Oct Provided services, half for cash, half on credit. Total sale: 56,000 23-Oct Made a payment on the line of credit of: 10,000 30-Oct Paid the monthly payroll amounts to employees. The gross payroll was: 17,500 Amounts withheld from the employees' cheques were as follows: • Canada pension plan premiums (CPP) 802 • Employment insurance premiums (EI) 259 • Income tax 2,950 (Only record the employee payroll at this time. You do not need to record the employer portions of remittances) nstructions a) Prepare all of the journal entries required as a result of the above transactions b) Prepare the current liabilities section of the statement of financial position at October 31, 2020

Answer 1

In the books of Juliana Ltd:
Event Date	Account Title	Debit	Credit
1-Oct	Bank A/c	28250
	Bank Overdraft		28250
1-Oct	Bank Overdraft	52250
	Line of credit		52250
5-Oct	Unearned revenues	12000
	Accounts recievable	19500
	Sale		31500
12-Oct	Inventory	20000
	Accounts Payable		20000
15-Oct	Income Tax Payable	5620
	Cash		5620
20-Oct	Accounts Payable	85600
	Cash		85600
21-Oct	Cash	5000
	Unearned revenue		5000
22-Oct	Cash	28000
	Accounts recievable	28000
	Sale		56000
23-Oct	Line of Credit	10000
	Cash		10000
30-Oct	Gross Payroll	17500
	Income Tax		2950
	CPP		802
	EI		259
	Cash		13489

Current Liabilities as on October 31, 2020
Account name	Opening Balance	Additions	Paid out	Closing
Bank Overdraft	24,000	28,250	(52,250)	-
Accounts payable	112,500	20,000	(85,600)	46,900
CPP Payable	1,000		802	1,802
EI Payable	2,000		259	2,259
Income taxes payable	5,620	(5,620)	2,950	2,950
Unearned revenues	12,000	(12,000)	5,000	5,000
Line of credit		52,250	(10,000)	42,250