Cullumber Company's balance sheet at December 31, 2021, is presented below. Cullumber Company Balance Sheet December 31, 2021 Cash $13,450 Accounts payable $8,510 Accounts receivable 20,700 Common stock 21,300 Allowance for doubtful accounts (840) Retained earnings 13,190 Inventory 9,690 $43,000 $43,000 During January 2022, the following transactions occurred. Cullumber uses the perpetual inventory method. Jan. 1 Cullumber accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $3,600 account 3 Cullumber wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300). 8 Cullumber purchased $17,710 of inventory on account. 11 Cullumber sold for $26,300 on account inventory that cost $18,930. 15 Cullumber sold inventory that cost $630 to Jack Rice for $1,100. Rice charged this amount on his Visa First Bank card. The service fee charged Cullumber by First Bank is 3%. 17 Cullumber collected $25,000 from customers on account. 21 Cullumber paid $17,830 on accounts payable. 24 Cullumber received payment in full ($300) from Drake Company on the account written off on January 3. 27 Cullumber purchased advertising supplies for $1,530 cash. 31 Cullumber paid other operating expenses, $3,390. Adjustment data: 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 $520 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.) Prepare journal entries for the transactions listed above and adjusting entries. (Include entries for cost of goods sold using the perpetual inventory system.) (Round answers to 0 decimal places, e.g. 1,250. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit (To record sales revenues.) (To record cost of goods sold.) (To record sales revenues and service charges.) (To record cost of goods sold.) (To record cost of goods sold.) (To reverse allowance for doubtful debts.) (To record cash received from Drake Company.) (To record cash received from Drake Company.) (1) (1) (2) (3) (4) eTextbook and Media Prepare an adjusted trial balance at January 31, 2022. (Round answers to 0 decimal places, e.g. 1,250.) CULLUMBER COMPANY Adjusted Trial Balance Debit Credit S Totals S Prepare an income statement for the month ending January 31, 2022. (Round answers to decimal places, e.g. 1,250.) CULLUMBER COMPANY Income Statement $ S Prepare a retained earnings statement for the month ending January 31, 2022. (Round answers to O decimal places, e.g. 1,250.) CULLUMBER COMPANY Retained Earnings Statement Prepare a classified balance sheet as of January 31, 2022. (List Current Assets in order of liquidity. Round answers to o decimal places, e.g. 1,250.) CULLUMBER COMPANY Balance Sheet Assets $ $ Liabilities and Stockholders' Equity $
