Blossom Company's balance sheet at December 31, 2021, is presented below. Blossom Company Balance Sheet December 31, 2021 Cash $13,270 Accounts payable $9,520 Accounts receivable 20,200 Common stock 22.000 Allowance for doubtful accounts (790) Retained earnings 10,770 Inventory 9,610 $42,290 $42,290 During January 2022, the following transactions occurred. Blossom uses the perpetual inventory method. Jan. 1 Blossom accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $6,000 account. 3 Blossom wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300). 8 Blossom purchased $16,810 of inventory on account. 11 Blossom sold for $22,600 on account inventory that cost $16,040. 15 Blossom sold inventory that cost $740 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Blossom by First Bank is 3%. 17 Blossom collected $24.500 from customers on account. 21 Blossom paid $17,450 on accounts payable. 24 Blossom received payment in full ($300) from Drake Company on the account written off on January 3. 27 Blossom purchased advertising supplies for $1,480 cash. 31 Blossom paid other operating expenses, $3,190. Adjustment data: 1. Interest is recorded for the month on the note from January 1. 2. Bad debts are expected to be 6% of the January 31, 2022, accounts receivable. 3. A count of advertising supplies on January 31, 2022, reveals that $550 remains unused. 4. The income tax rate is 30%. (Hint: Prepare the income statement up to Income before taxes and multiply by 30% to compute the amount; round to whole dollars.) (You may want to set up T-accounts to determine ending balances.) Your wrisparally correct Prepare journal entries for the transactions listed above and adjusting entries. (Include entries for cost of goods sold using the perpetual invertory system Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem) (Round answers to decimal places, es 1,250. Date Account Tities and Explanation Debit Credit Notas Receivable Accounts Receivable Allowance for Doubtful Accounts Inventory 16810 Accounts Pwable Accounts Rechable 22600 To record sales revenues.) bant Imerbory 15040 (To record cost of goods sold Jan 15 Service Change Expense Sales Revenue (To record sales revenues and service charges.) Color Goods Sold Inventory C70 (To record cost of goods sold) 24500 Accounts Receivable 24500 Account Payable Cash Accounts Receive Allowance for outful Account Torer owance for the 1480 (To record cash received from Draku Company] Other Opern Expanse Cash Jan 31 (1) Interest Receivable Interest Revenue (2) Bad Debts Expense 400 Al o Doutnal Account (3) Supplies Expanse Suple (4) Income Taxiperse Income Taxatie
