Cullumber Company's balance sheet at December 31, 2021, is presented below. Cullumber Company Balance Sheet December 31, 2021 Accounts payable $9520 Cash $13300 Accounts receivable 19300 Common stock 19900 Allowance for doubtful accounts Retained earnings (840) 11430 Inventory 9090 $40850 $40850 During January 2022, the following transactions occurred. Cullumber uses the perpetual inventory method. Cullumber accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $6000 account. Cullumber wrote off as uncollectible the accounts of Walter Corporation ($400) and Drake Company ($300) Cullumber purchased $15530 of inventory on account. Jan. 1 3 8 Cullumber sold for $26400 on account inventory that cost $17530. 11 Cullumber sold inventory that cost $720 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Cullumber by First Bank is 3% 15 Cullumber collected $23600 from customers on account. 17 Cullumber paid $16130 on accounts payable. 21 Cullumber received payment in full ($300) from Drake Company on the account written off on January 3. 24 Cullumber purchased advertising supplies for $1280 cash Cullumber paid other operating expenses, $3170. 27 31 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. A count of advertising supplies on January 31, 2022, reveals that $540 remains unused. 3. 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.) 4. CULLUMBER COMPANY Income Statement January 31, 2022 $ $ $ Net Income /(Loss) Cullumber Company's balance sheet at December 31, 2021, is presented below. Cullumber Company Balance Sheet December 31, 2021 Accounts payable $9520 Cash $13300 Accounts receivable 19300 Common stock 19900 Allowance for doubtful accounts Retained earnings (840) 11430 Inventory 9090 $40850 $40850 During January 2022, the following transactions occurred. Cullumber uses the perpetual inventory method. Cullumber accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $6000 account. Cullumber wrote off as uncollectible the accounts of Walter Corporation ($400) and Drake Company ($300) Cullumber purchased $15530 of inventory on account. Jan. 1 3 8 Cullumber sold for $26400 on account inventory that cost $17530. 11 Cullumber sold inventory that cost $720 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Cullumber by First Bank is 3% 15 Cullumber collected $23600 from customers on account. 17 Cullumber paid $16130 on accounts payable. 21 Cullumber received payment in full ($300) from Drake Company on the account written off on January 3. 24 Cullumber purchased advertising supplies for $1280 cash Cullumber paid other operating expenses, $3170. 27 31 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. A count of advertising supplies on January 31, 2022, reveals that $540 remains unused. 3. 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.) 4. CULLUMBER COMPANY Income Statement January 31, 2022 $ $ $ Net Income /(Loss)
