Digital Home, Incorporated $($DHI$)$ is a company that sells and installs smart kitchen appliances, such as refrigerators,

ovens, and dishwashers. The company is located in Dayton, Ohio. The company owns their office building. The

company's bookkeeper is not trained in accounting. He can record simple daily transactions, collect receivables, and pay

vendors. Payroll is outsourced to a payroll company. Whenever the bookkeeper encountered a transaction he did not

know how to journalize, he added it to a list. Your job is to record those transactions that were not recorded by the

bookkeeper. You will also need to prepare some adjusting entries and year$-$end financial statements.

DHI uses straight$-$line depreciation $($for both financial accounting and its tax return$)$ and depreciates assets to the

nearest whole month in use during the year. The company uses the perpetual LIFO inventory method with lower of cost

or net realizable value applied to individual items. Purchases and sales are recorded using the gross method.

Adjustments are only recorded at the end of the fiscal year unless otherwise noted.

DHI has $300,000$ shares of $$8\mathrm{.}00$ par value common stock authorized. The corporation uses the cost method of

accounting for treasury stock. DHI prepares all financial statements in accordance with GAAP. DHI's incremental

borrowing rate is $7\%.$ The company's common stock was selling for $$25$ per share throughout the entire last quarter of

You will find the $\frac{12}{31}\frac{?}{23}$ preliminary trial balance for DHI on the last page of this assignment. You can assume the

amounts on the trial balance are correct so far unless you are given information to the contrary. The list of transactions

below needs your attention. Unless you are told otherwise, assume the information in these transactions has not been

recorded. You will also find the post$-$closing trial balance for $2022$ on the last page. DHI's effective tax rate in $2022$ was

$20\%.$ You can assume the Income Tax Expense amount on the $12/31/23$ preliminary trial balance is correct for $2023|$

even with the entries and adjustments you will make.

For simplicity, all operating expenses for the current year are shown in one account entitled "Operating Expenses." But,

when you complete your entries, use specific account titles for any operating expenses you need to record $($such as

Salaries Expense or Insurance Expense$).$ However, if the accounts you add are Operating Expenses, you may combine

them into the amount reported as Operating Expenses on the income statement.

December tends to be a slow month for DHI since most folks are not thinking about home updates during the

holiday season. To encourage business, DHI offered the following promotion. For every refrigerator purchased in

December, the customer will receive free delivery & installation and a coupon for $15\%$ off an additional

purchase through June $30,2024.$ To qualify for the promotion, the customer must purchase and pay for a

refrigerator and schedule installation by $\frac{1}{31}\frac{?}{2024}.$ The following is the data from the promotion.

$37$ refrigerators were sold in December. Customers paid $$2,200$ for each refrigerator $($which is

the normal standalone price$)$ and that price includes free delivery & installation. The cost of a

refrigerator is $$1,100.$

$20$ of the refrigerators were delivered and installed. $17$ will be delivered and installed in January.

The price charged for delivery and installation is normally $$210$ per refrigerator.

Customers paid using a bank credit card $($such as VISA or MasterCard$).$

DHI estimates that $30\%$ of the coupons for a future purchase will be redeemed by the deadline.

The average customer purchase is estimated at $$2,000.$ Redeeming a coupon will give customers

$15\%$ off their purchase. No coupons were redeemed in $2023.$

Record all the entries necessary for the $37$ refrigerators sold. DHI records the revenue from product sales in a

Sales account. The company records the revenue from installation services in an Installation Revenue account.