Exercise 14 37 (Algo) General ledger exercise bonds installment note, early extinguishment LO14 2, 14 3, 14 5 On January 1, 2024, the general ledger of Freedom Fireworks includes the following account balances Accounts Debit Credit Cash $ 102,600 Accounts receivable 36,800 Inventory 153,400 Land 81,300 Buildings 134,000 Allowance for uncollectible accounts $ 3,200 Accumulated depreciation 11,000 Accounts payable 33,100 Bonds payable 134,000 Discount on bonds payable 31,400 Common stock 214,000 Retained earnings 144,200 Totals $ 539,500 $ 539,500 During January 2024, the following transactions occurred January 1 Borrowed $114,000 from Captive Credit Corporation The installment note bears interest at 5 annually and matures in 5 years Payments of $2,151 32 are required at the end of each month for 60 months January 1 Called the bonds at the contractual call price of $114,000 The 7 bonds pay interest semiannually each June 30 and December 31 January 4 Received $32,400 from customers on accounts receivable January 10 Paid cash on accounts payable, $25,000 January 15 Paid cash for salaries, $30,300 January 30 Firework sales for the month totalled $201,400 Sales included $66,400 for cash and $135,000 on account The cost of the units sold was $119,500 January 31 Paid the first monthly installment of $2,151 related to the $114,000 borrowed on January 1 The following information is available on January 31, 2024 Depreciation on the building for the month of January is calculated using the straight line method At the time the building was purchased, the company estimated a service life of 10 years and a residual value of $25,400 At the end of January, $4,400 of accounts receivable are past due, and the company estimates that 50 of these accounts will not be collected Of the remaining accounts receivable, the company estimates that 2 will not be collected No accounts were written off as uncollectible in January Unpaid salaries at the end of January are $27,500 Accrued income taxes at the end of January are $6,400

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Posted on Sep 23, 2024

On January 1, 2024, the general ledger of Freedom Fireworks includes the following account balances:

Accounts	Debit	Credit
Cash	$ 102,600
Accounts receivable	36,800
Inventory	153,400
Land	81,300
Buildings	134,000
Allowance for uncollectible accounts		$ 3,200
Accumulated depreciation		11,000
Accounts payable		33,100
Bonds payable		134,000
Discount on bonds payable	31,400
Common stock		214,000
Retained earnings		144,200
Totals	$ 539,500	$ 539,500

During January 2024, the following transactions occurred:

January 1	Borrowed $114,000 from Captive Credit Corporation. The installment note bears interest at 5% annually and matures in 5 years. Payments of $2,151.32 are required at the end of each month for 60 months.
January 1	Called the bonds at the contractual call price of $114,000. The 7% bonds pay interest semiannually each June 30 and December 31.
January 4	Received $32,400 from customers on accounts receivable.
January 10	Paid cash on accounts payable, $25,000.
January 15	Paid cash for salaries, $30,300.
January 30	Firework sales for the month totalled $201,400. Sales included $66,400 for cash and $135,000 on account. The cost of the units sold was $119,500.
January 31	Paid the first monthly installment of $2,151 related to the $114,000 borrowed on January 1.

The following information is available on January 31, 2024.

Depreciation on the building for the month of January is calculated using the straight-line method. At the time the building was purchased, the company estimated a service life of 10 years and a residual value of $25,400.
At the end of January, $4,400 of accounts receivable are past due, and the company estimates that 50% of these accounts will not be collected. Of the remaining accounts receivable, the company estimates that 2% will not be collected. No accounts were written off as uncollectible in January.
Unpaid salaries at the end of January are $27,500.
Accrued income taxes at the end of January are $6,400.