Raymond Construction’s trial balance at December 31, 2020, is presented as follows. All 2020 transactions have been recorded except for the items described below.Unrecorded transactions:

1. On May 1, 2020, Raymond purchased equipment for £13,000 plus sales taxes of £780 (all paid in cash).

2. On July 1, 2020, Raymond sold for £3,500 equipment which originally cost £5,000. Accumulated depreciation on this equipment at January 1, 2020, was £1,800; 2020 depreciation prior to the sale of the equipment was £450.

3. On December 31, 2020, Raymond sold on account £9,400 of inventory that cost £6,600.

4. Raymond estimates that uncollectible accounts receivable at year-end is £4,000.

5. The note receivable is a one-year, 8% note dated April 1, 2020. No interest has been recorded.

6. The balance in prepaid insurance represents payment of a £4,400 6-month premium on October 1, 2020.

7. The building is being depreciated using the straight-line method over 40 years. The residual value is £20,000.

8. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The residual value is 10% of cost.

9. The equipment purchased on May 1, 2020, is being depreciated using the straight-line method over 5 years, with a residual value of £1,000.

10. The patent was acquired on January 1, 2020, and has a useful life of 10 years from that date.

11. Unpaid salaries and wages at December 31, 2020, total £2,200.

12. The unearned rent revenue of £6,000 was received on December 1, 2020, for 4 months rent.

13. Both the short-term and long-term notes payable are dated January 1, 2020, and carry a 9% interest rate. All interest is payable in the next 12 months.

14. Income tax expense was £17,000. It was unpaid at December 31.

Instructions
a. Prepare journal entries for the transactions listed above.
b. Prepare a December 31, 2020, adjusted trial balance.
c. Prepare a 2020 income statement and a 2020 owner’s equity statement.
d. Prepare a December 31, 2020, classified statement of financial position.

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Credit Debit Cash 28,000 36,800 Accounts Receivable Notes Receivable Interest Receivable 10,000 -0- Inventory 36,200 Debit Credit Prepaid Insurance 4,400 Land 20,000 160,000 Buildings Equipment 60,000 Patents 8,000 Allowance for Doubtful Accounts 300 Accumulated Depreciation-Buildings Accumulated Depreciation-Equipment Accounts Payable Income Taxes Payable Salaries and Wages Payable 49,000 24,000 28,300 -0- -0- Unearned Rent Revenue 6,000 Notes Payable (due in 2021) Interest Payable Notes Payable (due after 2021) Owner's Capital Owner's Drawing 11,000 -0- 35,000 113,600 12,000 Sales Revenue 910,000 Interest Revenue -0- Rent Revenue Gain on Disposal of Plant Assets Bad Debt Expense -0- Cost of Goods Sold 630,000 Depreciation Expense Income Tax Expense Insurance Expense Interest Expense Other Operating Expenses Amortization Expense Salaries and Wages Expense -0- --0- -0- -0- 61,800 -0- 110,000 Total £1,177,200 £1,177,200