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    Denver Pharmacies, Journalize the transactions

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    The following transactions of Denver Pharmacies occurred during 2011 and 2012:

    2011

    Jan 9 Purchased computer equipment at a cost of $9,000, signing a six-month, 6% note payable for that amount.
    29 Recorded the week's sales of $64,000, three-fourths on credit, and one-fourth for cash. Sales amounts are subject to a 6% state sales tax.
    Feb 5 Sent the last week's sales tax to the state.
    28 Borrowed $204,000 on a four-year, 10% note payable that calls for $51,000 annual installment payments plus interest. Record the current and long-term portions of the note payable in two separate accounts.
    Jul 9 Paid the six-month, 6% note, plus interest, at maturity.
    Aug 31 Purchased inventory for $12,000, signing a six-month, 9% note payable.
    Dec 31 Accrued warranty expense, which is estimated at 2% of sales of $603,000.
    31 Accrued interest on all outstanding notes payable. Make a separate interest accrual for each note payable.

    2012

    Feb 28 Paid the first installment and interest for one year on the four-year note payable.
    29 Paid off the 9% note plus interest at maturity.

    Requirement
    1.Journalize the transactions in Denver's general journal. Explanations are not required.

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    https://brainmass.com/business/accounting-for-liabilities/denver-pharmacies-journalize-the-transactions-477059

    Solution Summary

    Your tutorial is attached in excel with instructional comments to help you follow the interest expense, interest payable and repayment entries.

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