Chapter 4
Current Liabilities
179
AP-18A (
2
5
8
)
GoodJob Company buys and sells home appliances and uses the perpetual inventory system.
GoodJob has a year-end of December 31. During 2017, the company had the following
transactions.
Jan 15 Purchased vacuum cleaners worth $60,000 from V Wholesalers, on account.
Feb 4 Sold vacuum cleaners for $45,000 cash, which includes a three-year warranty.
GoodJob bought these vacuum cleaners for $30,000.
Feb 4 Recorded $15,000 of estimated warranty liability for the year.
Feb 15 Paid the full amount owing to V Wholesalers.
May 8 Received utilities bill for $3,000, to be paid exactly after 15 days.
May 23 Paid the utilities bill which was received on May 8.
Jul 11 Received $42,000 cash for the sale of vacuum cleaners which cost the company
$30,000. The delivery is to be made on August 31.
Aug 31 Delivered the vacuum cleaners from the July 11 transaction.
Prepare journal entries to record the above transactions.
Date
Account Title and Explanation
Debit
Credit
