Amidon Company, a merchandiser, recently completed its calendar-year 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debited to Prepaid Expenses. The company's income statement and balance sheets follow. AMIDON COMP Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current 1liabilities Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity 56,100 78,400 57,000 277,000 253, 000 2,600 391,000 74,000 2,100 409,200 188,000 129,000 (40,0001 (55,0001 $557,200 $465,000 54,200 $117,000 8, 000 125,000 54, 000 179,000 67,200 72,000 139,200 176,000160,000 48,000 194,000126,000 $557,200 $465,000 AMI DON COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit $669,000 306,000 363,000 Prey ,-1 of 1 Next AMIDON COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses $669,000 306,000 363,000 Depreciation expense s 19,000 153,000 172,000 Other expenses Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income (S,800) 185,200 32,000 $153,200 Additional Information on Year 2017 Transactions a. The loss on the cash sale of equipment was $5,800 (details in b) b. Sold equipment costing $51,000, with accumulated depreciation of $34,000, for $11,200 cash. c. Purchased equipment costing $110,000 by paying $32,000 cash and signing a long-term note payable for the balance. d. Borrowed $5,000 cash by signing a short-term note payable e. Paid $60,000 cash to reduce the long-term notes payable. f. Issued 3,200 shares of common stock for $20 cash per share. g. Declared and paid cash dividends of $85,200. Requirement General Journal General Ledger Trial Balance Direct Method Indirect Method Using the income statement, the comparative balance sheet, and the additional information gi current fscal year. Upon completion, the trial balance tab should agree with the December 31,2017 balances bove, reconstract the entries for the swmmarized activity of the View transaction list Journal entry worksheet 14 Reconstruct the journal entry for cash receipts from customers, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Debit Credit Date Account Title Dec 31 View general journal Clear entry Record entry Journal entry worksheet 4 7 8 14 Reconstruct the journal entry for cash payments for inventory, incorporating the change in the related balance sheet account(s), if any. Notes were not issued for the purchase of inventory Note: Enter debits before credits Date Account Title Debit Credit Dec 31 Record entry Clear entry View general journal 14 8 7 5 3 4 2 Reconstruct the journal entry for depreciation expense, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Debit Credit Account Title Date Dec 31 View general journal Clear entry Record entry 2 3 4 5 7 8 14 Reconstruct the journal entry for cash paid for operating expenses, incorporating the change in the related balance sheet account(s), if any Note: Enter debits before credits. Date Account Title Credit Debit Dec 31 Journal entry worksheet K1 23 4 56 7m8 14 Reconstruct the entry for the purchase of new equipment. Note: Enter debits before credits. Date Account Title Debit Credit Dec 31 Clear entry Record entry View general journal Journal entry worksheet 14 Reconstruct the entry for the issuance of the short-term note payable Note: Enter debits before credits Debit Date Account Title CHas Dec 31 Clear entry Record entry View general journal 14 9 8 6 7 4 Reconstruct the entry for the payment on the long-term note payable. Note: Enter debits before credits. Debit Account Title Credit Date Dec 31 Record entry Clear entry View general journal