Question - Record the journal entries for the following events.
Feb. 21 The second client that you issued a quote to on Feb. 13 has phoned and would like you to ship the order today. You shipped the order and your client received it today but through a shipping error, you sent only 8 programs and 8 training manuals. The client is furious and in an effort to calm them, you reduce the price of the programs by $20 each before GST. You expect to receive payment next month. You waive all freight charges relating to this sale.
Feb. 22 The client you shipped the products to yesterday returns one of the programs. You issue them a credit memo for this item (remember you originally sold the program to them at a reduced price). No freight relates to this credit memo.
Feb. 23 Golden Timers sends the remaining backordered day timers on invoice 3031 along with the 12 replacement Day Timers for the damaged ones. Freight relating to this shipment ended up being $55 before GST. Because you are a new customer who received some damaged day timers, they are only charging you $13 per unit before GST for just this shipment of day timers. You intend to pay the invoice later.
Feb. 27 You use a cheque to pay the full balance owing to Golden Timers.
Feb. 28 Record the pay for your employee (just the one hired last month) for the month of February using the salary amount as last month.
Feb. 28 The monthly inventory count reveals that a software program is defective (this is the one that was returned on Feb. 22) and should be written-off as there is no hope of obtaining a refund from the manufacturer.
Feb. 28 You buy furniture from a one-time supplier named Alberta Furniture Ltd. (this is a one-time supplier) for $4,200 (this amount includes GST). You will use a cheque to pay for the furniture on invoice 586. There is no freight relating to this purchase.
Feb. 28 Set up a prepaid portion for the insurance that was expensed in early January.
Feb. 28 The remainder of the receivable from Red Deer Ltd. is written off as the company has been placed into receivership and management is nowhere to be found. Adjust the GST effect of the item written off too. (Hint: Use the revenues journal).
Feb. 28 You have also determined that the allowance for doubtful accounts at the end of February should be $600.
Feb. 28 Your bank has asked you to prepare financial statements for the two months ended February 28, 2019 so you need to record depreciation on the computer since the beginning of the year which you have determined to be $85.