Exercise 7 21 Complete the accounting cycle using long term asset transactions (LO7 4, 7 7) Skip to question The following information applies to the questions displayed below On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances Accounts Debit Credit Cash $ 59,300 Accounts Receivable 26,200 Allowance for Uncollectible Accounts $ 2,800 Inventory 36,900 Notes Receivable (5 , due in 2 years) 19,200 Land 161,000 Accounts Payable 15,400 Common Stock 226,000 Retained Earnings 58,400 Totals $ 302,600 $ 302,600 During January 2021, the following transactions occur January 1 Purchase equipment for $20,100 The company estimates a residual value of $2,100 and a four year service life January 4 Pay cash on accounts payable, $10,100 January 8 Purchase additional inventory on account, $88,900 January 15 Receive cash on accounts receivable, $22,600 January 19 Pay cash for salaries, $30,400 January 28 Pay cash for January utilities, $17,100 January 30 Sales for January total $226,000 All of these sales are on account The cost of the units sold is $118,000 Information for adjusting entries Depreciation on the equipment for the month of January is calculated using the straight line method The company estimates future uncollectible accounts The company determines $3,600 of accounts receivable on January 31 are past due, and 50 of these accounts are estimated to be uncollectible The remaining accounts receivable on January 31 are not past due, and 3 of these accounts are estimated to be uncollectible (Hint Use the January 31 accounts receivable balance calculated in the general ledger ) Accrued interest revenue on notes receivable for January Unpaid salaries at the end of January are $33,200 Accrued income taxes at the end of January are $9,600 Record the closing entry for revenues Record the closing entry for expenses Prepare a classified balance sheet as of January 31, 2021 Prepare an adjusted trial balance as of January 31, 2021 Analyze how well TNT Fireworks manages its assets Requirement 1 a 1 Calculate the return on assets ratio for the month of January

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Exercise 7-21 Complete the accounting cycle using long-term asset transactions (LO7-4, 7-7) Skip to question [The following information applies to the questions displayed below.] On

Exercise 7-21 Complete the accounting cycle using long-term asset transactions (LO7-4, 7-7)

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[The following information applies to the questions displayed below.] On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances:

Accounts	Debit		Credit
Cash	$	59,300
Accounts Receivable		26,200
Allowance for Uncollectible Accounts			$	2,800
Inventory		36,900
Notes Receivable (5%, due in 2 years)		19,200
Land		161,000
Accounts Payable				15,400
Common Stock				226,000
Retained Earnings				58,400
Totals	$	302,600	$	302,600

During January 2021, the following transactions occur:

January	1	Purchase equipment for $20,100. The company estimates a residual value of $2,100 and a four-year service life.
January	4	Pay cash on accounts payable, $10,100.
January	8	Purchase additional inventory on account, $88,900.
January	15	Receive cash on accounts receivable, $22,600.
January	19	Pay cash for salaries, $30,400.
January	28	Pay cash for January utilities, $17,100.
January	30	Sales for January total $226,000. All of these sales are on account. The cost of the units sold is $118,000.

Information for adjusting entries:

Depreciation on the equipment for the month of January is calculated using the straight-line method.
The company estimates future uncollectible accounts. The company determines $3,600 of accounts receivable on January 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 3% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)
Accrued interest revenue on notes receivable for January.
Unpaid salaries at the end of January are $33,200.
Accrued income taxes at the end of January are $9,600.

Record the closing entry for revenues.

Record the closing entry for expenses.

Prepare a classified balance sheet as of January 31, 2021.

Prepare an adjusted trial balance as of January 31, 2021.

Analyze how well TNT Fireworks manages its assets:

Requirement 1:

a-1. Calculate the return on assets ratio for the month of January.