Chapter 4
Current Liabilities
181
AP-19A (
2
4
)
Porch Living sells outdoor furniture and accessories. It operates in a province which has a
7% PST and 5% GST. Porch Living charges PST and GST to customers, and pays PST and GST
on most purchases, except for inventory. Porch Living only pays GST on the purchase of
inventory. The following transactions occurred during May 2017.
May 2 Purchased inventory for $5,000 plus GST on account.
May 5 Sold inventory to a customer for $2,000 plus GST and PST on account. The
inventory costs $1,200.
May 12 Purchased $300 worth of office supplies, plus GST and PST in cash.
May 25 Sold inventory to a customer for $6,000 plus GST and PST for cash. The inventory
costs $3,200.
May 27 Received the total amount owing from the customer from May 5.
May 28 Paid the supplier from May 2 the amount owing.
May 31 Prepared the PST remittance to the provincial government.
May 31 Prepared the GST remittance to the federal government.
Record the transactions for May 2017.
Date
Account Title and Explanation
Debit
Credit
