B Koi Inc., a Manitobabased retail business, began operations on February During February,
Koi purchased a company vehicle for $ cash and $ of inventory for resale on account.
In February, Koi also sold ie one third of its inventory for $
As a Manitoba company, all of Koi's purchases and sales were subject to GST Koi is required to
file a GST return with the Canada Revenue Agency quarterly. Koi's first GST return covering the period
from February to April will be due on May
Koi is also registered as a vendor under Manitoba's Retail Sales Tax RST which requires Koi to charge
on the selling price not including GST of all its sales, and remit the RST collected to the Manitoba
government the following month. Koi also must pay Manitoba RST on all its purchases, except those
that are exempt from the tax. The inventory purchased for resale was exempt from Manitoba Retail
Sales Tax.
Koi uses a perpetual inventory costing system.
Required:
i Prepare the journal entries to record the February transactions.
ii How much GST is owedowing refund for February?
iii. How much Manitoba Retail Sales Tax is owed for February.
