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Chapter 9 - Liabilities.pdf

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Department
Accounting
Course
ACC 100
Professor
Else Grech
Semester
Fall

Description
Chapter 9 - Liabilities Thursday, April 03, 2014 4:01 PM Collection on Behalf of Third Parties Company records sale while collecting GST Dr. Cash Cr. Revenue Cr. GST Payable Company pays GST to government Dr. GST Payable Cr. Cash Company withholds moneyfrom employee'spay Dr. Wages Expense Cr. Income taxes payable Cr. CPP payable Cr. EI payable Cr. Union dues payable Cr. Cash Company pays appropriate parties Dr. Income taxes payable Dr. CPP Payable Dr. EI payable Dr. Union dues payable Cr. Cash Unearned Revenue Sale of gift card Dr. Cash Cr. Unearned revenue (liability) Customeruses the gift card Dr. Unearned Revenue (liability) Cr. Revenue Pricing of Bonds Proceedsfrom bond issue = Present value of interest payments + Present value of principal repayment Selling Bonds at Face Value Issue of Bonds Dr. Cash Dr. Cash Cr. Long-term debt - bonds Interest expense on bond Dr. Interest expense Cr. Cash Derecognition( Bond has matured and is retired by paying back principle to investors) Dr. Long-term debt - bonds Cr. Cash Selling Bonds at a Discount (Bonds sold less than face value) - occurs when the marketinterest rate is greater than the coupon rate - discount if the difference between face value and proceeds Dr. Cash Dr. Bond discount (contra-liability) Cr. Long-termdebt - bonds Effective Interest Rate to amortize discount (IFRS) - discount is amortized over the life of the bond and the amortized portion is in
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