$18,000 4,600 1,400 2,000 Harriet's Hats Incorporated Balance Sheet As of December 31, 20Y8 ASSETS Cash Accounts Receivable 5,000 Less: Allowance for Doubtful Accounts (400) Net Accounts Receivable Prepaid Rent Inventory Property. Plant, and Equipment 52,100 Less: Accumulated Depreciation (22,600) Net Property, Plant, and Equipment Total Assets LIABILITIES + OWNER'S EQUITY Accounts Payable Wages Payable Interest Payable Income Taxes Payable Notes Payable Total Liabilities 29,500 $55,500 $3,500 165 45 850 3,000 7,560 Common Stock Retained Earnings Total Owner's Equity Total Liabilities + Owner's Equity 21,000 26,940 47,940 $55,500 TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 2011 1 Sales and Accounts Receivable A These price of each $30. Als were con Cash Colections on toond 12.000 The company tiled $250 af records being incolectible and wrote them of The company follows a perdre des para bebes accounts receivable that will become uncollectible. As of the end of 207, the company states that of sceivables wil be uncollectible 2 story A The company began the year with 200 hats which had a cost of $10.00 each. The following purchases tal on account were made during 2049 January 15-525 hats $11.00 each March 23-365hts @ 12.00 each Jy2 - 450 Mats $13.50 each October 31 - 450 hats @ $14.00 each 8. Employees performed a physical count at end of 2019 and found that 480 pats remained in the warehouse. The company uses a periodic LIFO inventory system The company nade cash payments to inventory suppliers traing 519,000 . 3. Property, plant and Equipment A Below is a schedule of the store fatures and office equipment the company had in place at the end of 2078. Straight Ine depreciation is used for at store fixtures and office equipment PROPERTY, PLANT & EQUIPMENT (as of December 31, 2018) Asset ID Historical Cost Useful Date Acquired Savage Vale 1256 $18.500 6 years 5500 Jan 1, 2014 1876 $2,600 3 years $200 Jan 1, 2017 4299 $31,000 5 years $1.000 Jan 1, 2048 B. On January 1, new store foxtures were purchased for $5,000 in cash. The company expects the fidures to have a 5 year useful life and a $500 salvage value On July 1, office equipment (D#1256) was sold for $1.800 4 Debt A on October 1, 209, the company paid off the note payable that was outstanding at the beginning of the period. The noto was issued on October 1, 2018 with a 6% interest rate. It required semi-annual interest payments on March 31 and September 30. B. On November 1, 2099, the company borrowed 54,500 on a new 1-year note payable. This note carries a 4% interest rate with similar payment forms as the note that was just paid off 5. Operations A Once any prepaid rent from 2078 was used to more rent payments of 54,800 were made on March 1 and September 1 of 20y9 for their store building. Each rent payment is prepaid for six months. The balance in the prepaid account at the end of 2019 represents the rent for January and February 2010 B. Cash paid out for wages during 2049 totaled $11,600. Records indicate that salaries for the last week of December amounted to $200 and would be paid at the end of the first week in January (a two-week pay period). C. Other expenses that were paid in cash totaled 51750. 6. Income Taxes A The company paid its 20Y8 income taxes in March of 2049. B. The company has a 30% income tax rate for both 2078 and 2079 7. Common Stock A Dividends of $2,200 were declared and paid during 2049. 8. New common stock was issued for $15,000 during 2049 INTRO REVIEW HANDOUT | PAGE 2 REQUIRED Record the 200 transactions in the general journal, nouding cosing entries Label each transaction according to its corresponding number 1A 2A CL1, CL2. etc.). CREDIT TRANSACTION NUMBER Harrier's Hats Incorporated General Journal For the Year Ended December 31, 2019 ACCOUNT TITLE DEBIT Accant Receivable 56,112 Sales Cash Accunt receivable | IC id 58.110 43960 43,960 Allowancetvodoustful al 250 Accant recurate 250 Baddest expense 1,262 Allowance for doubtful al 1,362 purchases 22,260 22,260 Inventang (Beginning 2,000 closing investory 5,080 19000 Cash 29 Piccant pagable 26 Accant payable 19000 sales pearce 58110 58,110 REQUIRED Post each transaction to the general ledger accounts. Continue to label each entry according to its Corresponding number. A 2A, CL1, L2, c.) ASSETS EQUITY + LIABILITIES + Cash BAL 18.000 Accounts Payable 3.500 BAL Common Stock 21,000 BAL Wages Payable 165 BAL Retained Earnings 26,940 BAL Interest Payable 45 BAL Sales Revenue Accounts Receivable BAL 5.000 Income Taxes Payable 850 BAL Cost of Goods Sold Allowance for Doubtful Accounts 400 BAL Notes Payable 3,000 BAL Bad Debt Expense Prepaid Rent BAL 1,400 Depreciation Expense Inventory BAL 2,000 Gain/ Loss on Sale of Equipment NITRO ASSETS LIABILITIES + EQUITY - Purchases Interest Expense Property. Plant & Equipment BAL 52,100 Rent Expense Accumulated Depreciation 22,600 BAL Wages Expense Other Expenses Income Tax Expense Income Summary COM + se REQUIRED Using the following templates, show how the 2049 transactions would impact the current period financial statements, including the Income Statement, Statement of Retained Earnings and Balance Sheet for Harriet's Hats IMPACT ON CURRENT PERIOD EARNINGS 2049 Sales Revenue Cost of Goods Sold Net impact on Current Period Gross Profit Other Operating Expenses: Bad Debt Expense Depreciation Expense Interest Expense Rent Expense Wages Expense Other Expenses Gain/Loss on Sale of Equipment Income Before Income Tax Income Tax Expense Net Impact on Current Period Earnings 2049 $26,940 IMPACT ON RETAINED EARNINGS ACCOUNT Retained Earnings as of January 1, 2019 Add: Net Income Less: Dividends Retained Earnings as of December 31, 2049