Exercise 6-21 (Algo) Complete the accounting cycle using inventory transactions (LO6-2, 6-3, 6-5, 6-6, 6-7) (GL)

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

Accounts	Debit	Credit
Cash	$22,100
Accounts Receivable	37,000
Allowance for Uncollectible Accounts		$3,300
Inventory	31,000
Land	63,100
Accounts Payable		31,900
Notes Payable (6%, due in 3 years)		31,000
Common Stock		57,000
Retained Earnings		30,000
Totals	$153,200	$153,200

The $31,000 beginning balance of inventory consists of 310 units, each costing $100. During January 2024, Big Blast Fireworks had the following inventory transactions:

January 3	Purchase 1,000 units for $106,000 on account ($106 each).
January 8	Purchase 1,100 units for $122,100 on account ($111 each).
January 12	Purchase 1,200 units for $139,200 on account ($116 each).
January 15	Return 105 of the units purchased on January 12 because of defects.
January 19	Sell 3,400 units on account for $544,000 The cost of the units sold is determined using a FIFO perpetual inventory system.
January 22	Receive $489,000 from customers on accounts receivable.
January 24	Pay $319,000 to inventory suppliers on accounts payable.
January 27	Write off accounts receivable as uncollectible, $2,600.
January 31	Pay cash for salaries during January, $115,000.

The following information is available on January 31, 2024.

1. At the end of January, the company estimates that the remaining units of inventory purchased on January 12 are expected to sell in February for only $100 each. [Hint: Determine the number of units remaining from January 12 after subtracting the units returned on January 15 and the units assumed sold (FIFO) on January 19.]
2. The company records an adjusting entry for $5,410. for estimated future uncollectible accounts.
3. The company accrues interest on notes payable for January. Interest is expected to be paid each December 31.
4. The company accrues income taxes at the end of January of $12,400.

• Requirement
• General Journal
• General Ledger
• Trial Balance
• Income Statement
• Balance Sheet
• Analysis