Debit Credit Cash $28,160 Accounts Receivable 47,104 Notes Receivable 12,800 Interest Receivable 0 Inventory 46,336 Prepaid Insurance 4,608 Land 25,600 Buildings 192,000 Equipment 76,800 Patent 11,520 Allowance for Doubtful $640 Accounts Accumulated Depreciation- 64,000 Buildings Accumulated Depreciation- 30,720 Equipment Accounts Payable Salaries and Wages Payable 34,944 0 Notes Payable (due April 30, 2023) 14,080 Income Taxes Payable Interest Payable 0 Notes Payable (due in 2028) 44,800 Common Stock 64,000 Retained Earnings 81,408 Dividends 15,360 Sales Revenue 1,152,000 Interest Revenue Gain on Disposal of Plant Assets Bad Debt Expense 0 Cost of Goods Sold 806,400 Depreciation Expense Income Tax Expense 0 0 0 0 Insurance Expense 0 Interest Expense 0 Other Operating Expenses 79,104 Amortization Expense 0 Salaries and Wages Expense 140,800 Total $1,486,592 $1,486,592 The following transactions occurred during December. Dec Purchased equipment for $20,480, plus sales taxes of $1,024 (paid in cash). 2 2 Grouper sold for $4,480 equipment which originally cost $6,400. Accumulated depreciation on this equipment at January 1,2022, was $2,304; 2022 depreciation prior to the sale of equipment was $1,056. 15 Grouper sold for $6,400 on account inventory that cost $4,480. 23 Salaries and wages of $8,448 were paid. Adjustment data: 1 Grouper estimates that uncollectible accounts receivable at year-end are $5,120. 2. The note receivable is a one-year, 8% note dated April 1, 2022. No interest has been recorded. 3. The balance in prepaid insurance represents payment of a $4,608, 6-month premium on September 1, 2022. 4. The building is being depreciated using the straight-line method over 30 years. The salvage value is $38,400. 5. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 5. 6. 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. The equipment purchased on December 2, 2022, is being depreciated using the straight-line method over 5 years, with a salvage value of $2,304. The patent was acquired on January 1, 2022, and has a useful life of 9 years from that date. 7. 8. Unpaid salaries at December 31, 2022, total $2,816. 9. 10 10 Both the short-term and long-term notes payable are dated January 1, 2022, and carry a 10% interest rate. All interest is payable in the next 12 months. Income tax expense was $19,200. It was unpaid at December 31 (a) Your answer is partially correct. Prepare journal entries for the transactions listed above and adjusting entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts Record journal entries in the order presented in the problem) Account Titles and Explanation Equipment Cash Depreciation Expense Accumulated Depreciation-Equipment (To record depreciation expense on equipment.) Cash Accumulated Depreciation Equipment Equipment Debit Credit 21504 21504 1056 4,4807 1,056 Equipment Cash anabo Debit Depreciation Expense Accumulated Depreciation-Equipment (To record depreciation expense on equipment.) Cash Accumulated Depreciation Equipment Equipment Gain on Disposal of Plant Assets (To record sale of equipment.) Accounts Receivable Sales Revenue (To record sales revenue.) Cost of Goods Sold Inventory (To record cost of goods sold.) Salaries and Wages Expense Cash 1 Bad Debt Expense Allowance for Doubtful Accounts 21504 1,056 4,480 Credit 21504 1,056 27 1. Bad Debt Expense Allowance for Doubtful Accounts 2. Interest Receivable Interest Revenue 3. Insurance Expense Prepaid Insurance 4. Depreciation Expense Accumulated Depreciation-Buildings 5. Depreciation Expense Accumulated Depreciation-Equipment 6. Depreciation Expense Accumulated Depreciation-Equipment 7. Amortization Expense Patents 8. Salaries and Wages Expense Salaries and Wages Payable 9. Interest Expense Interest Payable 10. Income Tax Expense Income Taxes Payable 6. Depreciation Expense 7. Accumulated Depreciation-Equipment Amortization Expense Patents 8. Salaries and Wages Expense Salaries and Wages Payable 9. Interest Expense Interest Payable 10. Income Tax Expense Income Taxes Payable