Analyzing the Effects of Transactions Using T-Accounts, Preparing an Income Statement, and Evaluating the Net Prot Margin Ratio (P3-6) The following are selected account balances from a recent balance sheet of Exxon Mobil Corporation. The accounts have normal debi or credit balances, but they are not necessarily listed in good order. The amounts are shown in millions of dollars for the end of the prior year. Assume the year-end is December 31. Cash Long-term notes payable Accounts receivable Inventories 1,580 $ Property and equipment, net Common stock Other current assets 3,089 Short-term investments 26,342 Retained earnings 26,966 Accounts payable 18,528 Income taxes payable 21,416 Prepaid expenses 253,018 Long-term investments 15,637 Other assets and intangibles 1,469 Short-term notes payable $ 985 421,341 41,831 484 43,164 16.363 20,578 Other long-term debt Source: Exxon Mobil Corp. The following is a list of hypothetical transactions for January of the current year (in millions of dollars): a. Purchased new equipment for $1,610 on account. b. Received $3,100 on accounts receivable. c. Received and paid $3 for utility bills for utility usage during January. d. Earned $39,780 in sales of fuel to gas station franchisee customers, all on account. e. Used $5,984 of fuel inventory in the sales to customers in (d). [Title the account Cost of Sales.] f. Paid employees $1,238 for wages earned during the month. g. Paid three-fourths of the income taxes payable (rounded to the nearest million). h. Purchased $23 in supplies on account (include in Inventories). i. Prepaid $82 to rent a warehouse next month. . Paid $10 of other long-term debt principal and $1 in interest expense on the debt. k. Purchased a patent (an intangible asset) for $6 cash. Required: 1. Prepare journal entries for each transaction. Use the account titles that Exxon Mobil uses in the list above when a balance sheet account is affected. 2. Prepare T-accounts for the current year from the preceding list; enter the beginning balances based on the prior year's December 3 ending balances. You will need additional T-accounts for income statement accounts; enter zero for beginning balances. Post the effects of the transactions in the T-accounts, and compute ending balances. 3. Prepare an unadjusted income statement for January of the current year. 4. Compute the company's net profit margin ratio for the month ended January 31 of the current year. What does it suggest to you about Exxon Mobil Corporation?