CAPTAIN JET INC. BALANCE SHEET DECEMBER 31, 2017 Current Assets Cash 41,200 Notes Receivable 16,000 Accounts Receivable 38,800 Inventories 40,000 Prepaid Insurance 540 Prepaid Rent 500 Total Current Assets 137,040 Non-Current Assets Long-term Investments Investments in held-for-maturity securities 51,000 Land held for future development 45,500 Property, Plant, and Equipment Land 85,000 Buildings 291,000 Less: Accumulated Depreciation (187,500) Intangible Assets Capitalized Development Costs 8,000 Goodwill 76,000 Other Identifiable Intangible Assets 48,000 Total Non-Current Assets 417,000 Total Assets 554,040 Current Liabilities Notes Payable 110,000 Accounts Payable 33,500 Unearned Revenues 12,000 Income Taxes Payable 8,440 Property Taxes Payable 6,600 Interest Payable 1,500 Total Current Liabilities 172,040 Non-Current Liabilities Provisions Related to Pensions 0 Bonds Payable 0 Total Non-Current Liabilities 0 Total Liabilities 172,040 Stockholders' Equity Common Stock 100,000 Preferred Stock 100,000 Paid-in-capital - Common Stock 27,500 Paid-in-capital - Preferred Stock 10,000 Retained Earnings 152,250 Accumulated Other Comprehensive Income 5,000 Less: Treasury Stock (12,750) Total Stockholders' Equity 382,000 Total Liabilities and Stockholders' Equity 554,040 The 2017 balance sheet of the Captain Jet Inc. is attached. During 2018, the following events occurred. 1. On January 10, sell merchandise on account to Rayms $9,600 and Fischer $8,800. 2. On January 12, purchase merchandise on account from Zapfel $3,000 and Liotta $2,400. 3. On January 13, Receive checks, $4,000 from Longhini and $2,000 from Hall, for sales on account. 4. On January 15, send checks to Joosten for 9,000 and to Maida for $11,000 for merchandise purchased last year. 5. On January 16, issue credit of $400 to Fieber for merchandise returned. Hint: you need to create a "sales returns" account, which is a contra account for "sales revenue" on the income statement; meanwhile reduce accounts receivable. 6. On January 21, pay off the balances to Zapfel and Liotta for the purchases on January 12. 7. Summary monthly cash sales (for January) total $15,500. 8. On Feburary 9, receive payment in full from Rayms and Fischer. 9. On March 1, pay rent of $6,000 for a two-year term, effective on the day of purchase. 10. On April 1, sell merchandise on account to Dunlap $1,600. 11. On May 1, pay $400 cash for office supplies. All supplies are expensed right away. 12. Cash dividends totaling $800 are declared and paid on June 13. 13. On July 1, Issue a note of $120,000 to bank (one year, annual interest rate 3%) for cash. 14. On July 5, purchase merchandise from Maida for $33,000 on account 15. On July 7, issue common stock 1000 shares, $10 par, in exchange of a land with a fair market value of $15,000. 16. On July 8, return $200 of merchandise to Maida and receive credit. Hint: This is a purchase return, as well as reduces accounts payable 17. On August 1, sell merchandise to Lachey on account for $80,000. 18. On August 5, Pay off the balance to Maida. 19. On August 10, receive half of the payment from Lachey. 20. On August 14, expect $1,300 bad debt from Tooket and directly write it off from accounts receivable.(Hint: you need to record "bad debt expense" and reduce accounts receivable) 21. On August 30, Pay utitlities expense, $10,902. 22. On August 31, Lachey pays off its balance. 23. Over the year, sales and office employees earned $45,500 in salaries and wages, of which $1,500 was still payable at the end of year. 24. On October 1, pay off notes payable $110,000 and associated accrued interest $6,000, of which $1,500 was shown on the balance sheet. 25. On December 31, An unpaid utilities bill (December, $1,250) is due on January 10 next year. Additional Information at the end of the year: 1. Depreciation expense for the year was $14,250. 2. The company estimated that it has to pay federal income tax, $250. 3. After physically counting, the company decided that the ending inventories worth $40,146. 4. The company adopts the periodic inventory system. Instructions:

3. Prepare adjusted trial balance (in sheet "adj.TB"). 4. Prepare Income Statement, Retained Earnings Statement and Balance Sheet (in sheet "FSs"). 5. Prepare closing entries (in sheet "Closing").