3 Part II. Classifications - indicate whether each item belongs on an income statement or balance sheet (18 pts) Income Statement Balance Sheet Item Accounts Payable Accounts Receivable Cash Freight Out Inventory Salary & Wages Payable Sales Returns & Allowances Sales Revenue Salary & Wages Expense Part III. Short Answer - answer each question completely, showing work as needed (spreadsheet, typed or handwritten accepted) (60pts) 1. Corales Company acquires a delivery truck at a cost of $38,000. The truck is expected to have a salvage value of $6,000 and a useful life of 4 years. Use the straight-line method to calculate depreciation for each year. 2. During its first year of operations, Gavin Company had credit sales of $3,000,000. At the end of the year, $600,000 remained uncollected. The manager estimated $31,000 of the receivables will become uncollectable. (a) Show the journal entry to record the uncollectible amount. (b) Show the journal entry to perform a write off of the uncollectible amount. 3. On January 1, Hills Art sells work to Solo Inc, on account for $350, and offers a 2/14, net 30 discount. Solo paid for the work in full on January 7. Show the journal entries Hills would make to: (a) record the sale, and (b) record the payment. 4. On May 1, Claus Gordon Builders lends Lightfoot Construction $15,000 for new equipment on a 3. month, 5% note, which Lightfoot pays in full when it comes due. (a) Calculate the amount of interest that Lightfoot will owe, and (b) show the journal entry Claus will make to record receiving the payment and interest. 5. Rocket Groot Corporation purchased land for $250,000. They removed a small structure at a cost of $2000, but were able to sell scrap from the removal for $300. Attorney fees and commissions total $5000. What is the cost of the land that will be reported? een andeld it for $200. At the time of