Accounts payable $42,500
Sales Taxes Payable 6,600
Unearned service revenue 19,000
During January the following selected transactions occurred.
Jan. 1 Borrowed $15,000 in cash from Midland Bank on a 4-month 8%, $15,000 note.
Jan. 5 Sold merchandise for cash totaling $6,510, which includes 5% sales taxes.
Jan. 12 Provided services for customers who had made advance payment of $10,000. (Credit Service Revenue.)
Jan. 14 Paid state treasurer's department for sales taxes collected in December 2009, $6,600.
Jan. 20 Sold 500 units of a new product on credit at $48 per unit, plus 5% sales tax.
During January the company's employees earned wages of $70,000. Withholdings related to these wages were $5,355 for Social Security (FICA), $5,000 for federal income tax, and $1,500 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.
