Answered

Discover the answers you need at Westonci.ca, where experts provide clear and concise information on various topics. Explore thousands of questions and answers from knowledgeable experts in various fields on our Q&A platform. Our platform offers a seamless experience for finding reliable answers from a network of knowledgeable professionals.

Texas Roadhouse opened a new restaurant in October. During its first three months of operation, the restaurant sold gift cards in various amounts totaling $1,800. The cards are redeemable for meals within one year of the purchase date. Gift cards totaling $728 were presented for redemption during the first three months of operation prior to year-end on December 31. The sales tax rate on restaurant sales is 4%, assessed at the time meals (not gift cards) are purchased. Texas Roadhouse will remit sales taxes in January.

Required:
a. Record (in summary form) the $2,500 in gift cards sold ( keeping in mind that, in actuality the firm would record each sale of a gift card individually ).
b. Record the $728 in gift cards redeemed, including the 4% sales tax assessed.
c. Determine the balance in the Unearned Revenue account ( remaining liability for gift cards ) Texas Roadhouse will report on the December 31 balance sheet.

Sagot :

Answer:

General Journal Debit Credit

1 Cash 2600  

Unearned revenue  2600

(To record gift cards sold)  

2 Unearned revenue 832  

Sales tax payable  32

Sales revenue  800

(To record gift cards redeemed)

We hope this was helpful. Please come back whenever you need more information or answers to your queries. We hope you found this helpful. Feel free to come back anytime for more accurate answers and updated information. Westonci.ca is here to provide the answers you seek. Return often for more expert solutions.