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1. On February 1 Year 1, borrowed $60,000 cash from the local bank. The note had a 5 percent interest rate and was due on June 1, Year 1 2. Cash sales for the year amounted to $225,000 plus sales tax at the rate of 8 percent. 3. Ripley provides a 90-day warranty on the merchandise sold. The warranty expense is estimated to be 4 percent of sales. 4. Paid the sales tax to the state sales tax agency on $210,000 of the sales. 5. Pald the note due on June 1 and the related interest. 6. On November 1, Year 1, borrowed $46,000 cash from the local bank. The note had a 7 percent interest rate and a one-year term to maturity 7. Pald $4,000 in warranty repairs. 8. A customer has filed a lawsuit against Ripley for $110,000 for breach of contract. The company attorney does not believe the suit has merit ces Required a. Answer the following questions 1. What amount of cash did Ripley pay for interest during Year 1? 2. What amount of interest expense is reported on Ripley's income statement for Year 1? 3. What is the amount of warranty expense for Year 1? b. Post the liabilities transactions to T-accounts and prepare the current liabilities section of the balance sheet at December 31, Year 1 c. In the Cash Flow column, indicate whether the item is an inflow or outflow and if the item is an operating activity (OA). Investing activity (IA), or financing activity (FA) or not affected (NA). The first transaction has been recorded as an example. Complete this question by entering your answers in the tabs below. Required A1 Required A2 Required A3 Required B1 T Required B2 Account Bal Sheet Required What amount of cash did Ripley pay for interest during Year 17 (Round your answer nearest dollar amount.) Cash pard for interest Required A2 > Complete this question by entering your answers in the tabs below. Required Al Required A2 Required A3 Required B1 T Required 02 Account Bal Sheet Required What amount of Interest expense is reported on Ripley's income statement for Year 17 (Round your answer nearest dollar amount.) Introstexpono ces Complete this question by entering your answers in the tabs below. Required A1 Required A2 Required A3 Required B1T Required B2 Account What is the amount of warranty expense for Year 1? Bal Sheet Required c Warranty expense Complete this question by entering your answers in the tabs below. d Required A1 Required A2 Required A3 Required B1 T Required B2 Account Bal Sheet Post the liabilities transactions to T-accounts at December 31, Year 1. Required C rices Interest Payable Sales Tax Payable Beg Bal Beg. Bal. End. Bal End. Bal Warranty Payable Notes Payable Beg. Bal Bog. Bal End. Bal End. Bal Complete this question by entering your answers in the tabs below. Required A1 Required A2 Required A3 Required B1 T Required B2 Account Bal Sheet Required Prepare the current liabilities section of the balance sheet at December 31, Year 1. (Round your answers nearest dollar amount.) ces RIPLEY COMPANY Balance Shoot (partial) As of December 31, Year 1 Current liabilities Total current liabilities Complete this question by entering your answers in the tabs below. D Required A1 Required A2 Required A3 Required 81 T Required B2 Account Bal Sheet Required Show the effect of these transactions on the Cash Flow statement. Use + for increase, - for decrease, and NA for not affected. Indicate whether the item is an operating activity (OA), Investing activity (IA), or financing activity (FA) or not affected (NA). The first transaction has been recorded as an example, Event 1. 2 Cash Flow FA 3 4 5 6 7 8

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