Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Exercise 9-21 Complete the accounting cycle using long-term liability transactions (LO9-2, 9-8) [The following information applies to the questions displayed below.] On January 1,

image text in transcribedimage text in transcribed

Exercise 9-21 Complete the accounting cycle using long-term liability transactions (LO9-2, 9-8) [The following information applies to the questions displayed below.] On January 1, 2021, the general ledger of Freedom Fireworks includes the following account balances: Accounts Cash Accounts Receivable Inventory Land Buildings Allowance for Uncollectible Accounts Accumulated Depreciation Accounts Payable Common Stock Retained Earnings Totals Debit $ 12,500 36,600 153,300 80,300 Credit 133,000 $ 3,100 10,900 32,000 213,000 156,700 $415,700 $415,700 During January 2021, the following transactions occur: Borrow $113,000 from Captive Credit Corporation. The installment note bears interest at 6% annually and matures in 5 years. Payments of $2,185 are required at the end of each month for 60 months. Receive $32,300 from customers on accounts receivable. Pay cash on accounts payable, $24,000. January 1 January 4 January 10 January Pay cash for salaries, $30,200. 15 30 January January 31 Firework sales for the month total $201,200. Sales include $66,300 for cash and $134,900 on account. The cost of the units sold is $119,000. Pay the first monthly installment of $2,185 related to the $113,000 borrowed on January 1. Round your interest calculation to the nearest dollar. Exercise 9-21 Part 3 3. Prepare an adiusted trial balance as of January 31. 2021.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Accounting

Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas

10th edition

1260481956, 1260310175, 978-1260481952

More Books

Students also viewed these Accounting questions