1. Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 to 14). Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances. 2. Record adjusting entries on December 31, 2025, in the 'General Journal' tab. 3. Review the adjusted 'Trial Balance' as of December 31, 2025. 4. Prepare an income statement for the period ended December 31, 2025, in the 'Income Statement' tab. 5. Prepare a classified balance sheet as of December 31, 2025 in the 'Balance Sheet' tab.

Beyond the normal timekeeping features of most watches, MU watches are able to report temperature, altitude, and barometric pressure. MU watches are waterproof, so moisture from kayaking, rain, fishing, or even diving up to 100 feet won't damage them. Suzie decides to have MU watches available for sale at the start of each clinic. The following transactions relate to purchases and sales of watches during the second half of 2025 . All watches are sold for $500 each. July17July31August12August22September19September27October27November20December4December8Purchased50watchesfor$7,500($150perwatch)onaccount.Sold40watchesfor$20,000cash.Purchased40watchesfor$6,400($160perwatch)cash.Sold30watchesfor$15,000onaccount.PaidforwatchespurchasedonJuly17.Receivecashof$9,000forwatchessoldonaccountonAugust22.Purchased80watchesfor$13,600($170perwatch)cash.Sold90watchesfor$45,000cash.Purchased100watchesfor$18,000($180perwatch)onaccount.Sold40watchesfor$20,000onaccount. July 17 Purchased 50 watches for $7,500 ( $150 per watch) on account. July 31 Sold 40 watches for $20,000 cash. August 12 Purchased 40 watches for $6,400 ( $160 per watch) cash. August 22 Sold 30 watches for $15,000 on account. September 19 Paid for watches purchased on July 17. September 27 Receive cash of $9,000 for watches sold on account on August 22 . October 27 Purchased 80 watches for $13,600 ( $170 per watch) cash. November 20 Sold 90 watches for $45,000 cash. December 4 Purchased 100 watches for $18,000 ( $180 per watch) on account. December 8 Sold 40 watches for $20,000 on account. Late in December, the next generation of multiuse (MU II) watches is released. In addition to all of the features of the MU watch, the MU II watches are equipped with a global positioning system (GPS) and have the ability to download and play songs and videos off the Internet. The demand for the original MU watches is greatly reduced. As of December 31, the estimated net realizable value of MU watches is only $100 per watch. 1. Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 to 14 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances. 2. Record adjusting entries on December 31,2025, in the 'General Journal' tab. 3. Review the adjusted 'Trial Balance' as of December 31, 2025. 4. Prepare an income statement for the period ended December 31, 2025, in the 'Income Statement' tab. 5. Prepare a classified balance sheet as of December 31, 2025 in the 'Balance Sheet' tab