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The following are selected transactions of Blue Spruce Department Store Ltd. for the current year ended December 31. Blue Spruce is a private company operating in the province of Manitoba where PST is 8% and GST is 5%. PDSL follows ASPE and has a periodic inventory system, 1. 2 3. 4. 5 On February 2, Blue Spruce placed an order to buy goods for resale from Hashmani Limited for $48,000 plus GST. Terms of purchase are fo.b.destination, net 15. The goods arrived February 6 and the invoice was paid on February 20. (Hint Inventory for resale is purchased PST exempt.) On April 1, Blue Spruce purchased a truck for $48.000 from Schuler Motors Limited, paying $11.040 cash and signing a one-year, 8% note for the balance of the purchase price. Provincial sales tex of 8% and GST of 5% were charged by the supplier on the purchase price On May 1, Blue Spruce borrowed S71.000 from First Provincial Bank by signing a 582 100 non-interest-bearing note due one year from May 1 On June 30 and December 31, Blue Spruce remitted cheques for $18.700 each asinstalments on its current year tax liability. On August 14,Blue Spruce's board of directoes declared a $19,000 cash dividend that was payable on September 10 to shareholders ofrecord on August 31 On December 5, Blue Spruce received 51 300 from Jefferson Ltd as a deposit on a trailer that Jefferson is using for an office move. The deposit is to be returned to Jefferson after it retums the trailer in good condition on January 15. (Hint: Use the account Refund Liability) On December 10 Blue Sonuce purchased new furniture and fixtures for $13.000 on account. Provincial sales tax of 895 and GST of were charged by the supplier on the purchase price During December cash sales of $86.000 were recorded plus provincial sales tax and 5% GST that must be remitted by the 15th day of the follow month Both taxes are levied on the sale amount to the customer Ignore any cost of goods sold Blue Spruce's lease for store premises claror $2600 monthly renta payment plus 3 of net sales. The payment is due one week after month end 6. 7 8 9 9. 10. Blue Spruce's lease for its store premises calls for a $2,600 monthly rental payment plus 3% of net sales. The payment is due one week after month end. Blue Spruce was advised during the month of December that it is legally required to restore the area considered a land improvement) surrounding one of its new store parking lots, when the store is closed in 12 years. Blue Spruce estimates that the fair value of this obligation at December 31 is 584,000, The corporate tax return indicated taxable income of $204,700, Blue Sprace's income tax rate is 20% 11. Prepare all the journal entries necessary to record the above transactions when they occurred and any adjusting journal entries relative to the transactions that would be required to present financial statements at December 31 in accordance with GAAP. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select 'No Entry for the account titles and enter for the amounts.) Date Account Titles and Explanation Debit Credit Feb. 6 Purchases GST Receivable Accounts Payable Feb. 20 Accounts Payable Cash Apr. 1 Apr, 1 Dec. 10 Dec. 10 > C > (To record cash sales) c (To accre rent expense) (To record asset retirement obligation) (o record asset retirement obligation) (To record payment of income tax expense) (To accrue income tax expense) (To accrue interest expense) (To accrue expense on non-interest-bearing note) Identify the current liabilities that will be reported on Blue Spruce's December 31 SFP, and indicate the amount of each one Blue Spruce Department Store Ltd. Balance Sheet (Partial) December 31 > C C > (To record cash sales) c (To accre rent expense) (To record asset retirement obligation) (o record asset retirement obligation) (To record payment of income tax expense) (To accrue income tax expense) (To accrue interest expense) (To accrue expense on non-interest-bearing note) Identify the current liabilities that will be reported on Blue Spruce's December 31 SFP, and indicate the amount of each one Blue Spruce Department Store Ltd. Balance Sheet (Partial) December 31 > C

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