Comprehensive Problem 9 (Part Level Submission) Sheridan Company's trial balance at December 31, 2020, is presented below. All 2020 transactions have been recorded except for the items described following the trial balance. Debit Credit Cash Accounts Receivable $26,500 36,000 9,800 -0- Notes Receivable Interest Receivable Inventory Prepaid Insurance Land 36,200 3,660 20,100 141,000 55,000 9,100 Buildings Equipment Patents $500 47,000 22,000 27,200 -0- Allowance for Doubtful Accounts Accumulated Depreciation-Buildings Accumulated Depreciation Equipment Accounts Payable Salaries and Wages Payable Unearned Rent Revenue Notes Payable (due in 2020) Interest Payable Notes Payable (due after 2020) Common Stock Retained Earnings Dividends 6,000 13,000 -0- 36,000 54,000 47,360 12,500 Sales Revenue 900,000 Interest Revenue -0- Rent Revenue -0- Gain on Disposal of Plant Assets -0- Bad Debts Expense -0- Cost of Goods Sold 635,000 -0- -0- -0- Depreciation Expense Insurance Expense Interest Expense Other Operating Expenses Amortization Expense Salaries and Wages Expense 61,200 -0- 107,000 $1,153,060 Total $1,153,060 Unrecorded transactions: 1. On May 1, 2020, Sheridan purchased equipment for $16,800 plus sales taxes of $1,600 (all paid in cash). 2. On July 1, 2020, Sheridan sold for $3,600 equipment which originally cost $5,000. Accumulated depreciation on this equipment at January 1, 2020, was $2,000; 2020 depreciation prior to the sale of the equipment was $400. 3. On December 31, 2020, Sheridan sold on account $5,400 of inventory that cost $3,300. 4. Sheridan estimates that uncollectible accounts receivable at year-end is $4,000. 5. The note receivable is a one-year, 8% note dated April 1, 2020. No interest has been recorded. 6. The balance in prepaid insurance represents payment of a $3,660 6-month premium on September 1, 2020. 7. The buildings are being depreciated using the straight-line method over 30 years. The salvage value is $36,000. 8. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost. 9. The equipment purchased on May 1, 2020, is being depreciated using the straight-line method over 5 years, with a salvage value of $2,500. 10. The patent was acquired on January 1, 2020, and has a useful life of 10 years from that date. 11. Unpaid salaries and wages at December 31, 2020, total $2,100. 12. The unearned rent revenue of $6,000 was received on December 1, 2020, for 3 months' rent. 13. Both the short-term and long-term notes payable are dated January 1, 2020, and carry a 9% interest rate. All interest is payable in the next 12 months. Prepare an updated December 31, 2020, trial balance. Sheridan Company Trial Balance Debit Credit $ Total $
