Payables & Accrued liabilities

Question 1

Advanced payments (debit balance in accounts payable)

Answer 1

Should be added(credited) back to accounts payable

Question 2

Liabilities & interest earned

Answer 2

Interest earned is credited

Question 3

Sales Tax Payable Journal Entry

Answer 3

Dr. Cash
Cr. Sales
Cr. Sales Tax Payable

Question 4

Liquidation allocations

Answer 4

• Add Current Value of free assets and assets pledged for fully secured creditors then subtract payments to fully secured creditors.
• Then subtract liabilities with priority and you’re left with amount available for unsecured non-priority claims

Question 5

How to calculate estimated warranty liability

Answer 5

Estimated warranty cost minus actual warranty costs