Business, 05.02.2021 21:20 markeledwards699

Bavarian Bar and Grill opened for business in November 2016. During its first two months of operation, the restaurant sold gift certificates in various amounts totaling $5,200, mostly as Christmas presents. They are redeemable for meals within two years of the purchase date, although experience within the industry indicates that 80% of gift certificates are redeemed within one year. Certificates totaling $1,300 were presented for redemption during 2016 for meals having a total price of $2,100. The sales tax rate on restaurant sales is 4%, assessed at the time meals (not gift certificates) are purchased. Sales taxes will be remitted in January. Required:1. Prepare the appropriate journal entries (in summary form) for the gift certificates sold during 2016 (keeping in mind that, in actuality, each sale of a gift certificate or a meal would be recorded individually). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)A. Record the gift certificates sold during 2016.B. Record redemption of gift certificates sold in 2016 and redeemed in 2016.2. Determine the liability for gift certificates to be reported on the December 31, 2016, balance sheet. Liability$3. What is the appropriate amount for each classification (current or noncurrent) of the liabilities at December 31, 2016?a. Sales tax liability - current$ b. Sales tax liability - noncurrentLiability$c. Gift certificates - currentLiability$ d. Gift certificates - noncurrent$ Provide step by step calculations in the solution.

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Bavarian Bar and Grill opened for business in November 2016. During its first two months of operatio...

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