Following are selected account balances (in millions of dollars) from a recent UPS annual report, followed by several typical transactions. Assume that the following are account balances on December 31 (end of the prior fiscal year):

Account	Balance	Account	Balance
Property, plant, and equipment (net)	$14,694	Receivables	$1,749
Retained earnings	10,406	Other current assets	919
Accounts payable	1,337	Cash	964
Prepaid expenses	148	Spare parts, supplies, and fuel	478
Accrued expenses payable	2,150	Other non-current liabilities	3,410
Long-term notes payable	1,570	Other current liabilities	2,019
Other non-current assets	2,672	Additional Paid-in Capital	727
Common stock ($0.01 par value)	5

These accounts are not necessarily in good order and have normal debit or credit balances. (Note: Because these are not all of UPS's accounts, these will not balance in a trial balance.) Assume the following transactions (in millions, except for par value) occurred the next fiscal year beginning January 1 (the current year):

1. Provided delivery service to customers, who paid $3,390 in cash and owed $26,304 on account.
2. Purchased new equipment costing $3,514; signed a long-term note.
3. Paid $8,664 cash to rent equipment and aircraft, with $3,736 for rent this year and the rest for rent next year (a prepaid expense).
4. Spent $944 cash to repair facilities and equipment during the year.
5. Collected $26,685 from customers on account.
6. Repaid $190 on a long-term note (ignore interest).
7. Issued 200 million additional shares of $0.01 par value stock for $20 (thats $20 million).
8. Paid employees $10,276 for work during the year.
9. Purchased spare parts, supplies, and fuel for the aircraft and equipment for $7,764 cash.
10. Used $6,650 in spare parts, supplies, and fuel for the aircraft and equipment during the year.
11. Paid $864 on accounts payable.
12. Ordered $96 in spare parts and supplies.

Required:

1. Prepare journal entries for each transaction.
2. Enter the ending balances from December 31 as the respective beginning balances for January 1 of the current year. Record in the T-accounts the effects of each transaction. Label each using the letter of the transaction.
3. Prepare an unadjusted income statement for the current year ended December 31.
4. Compute the company's net profit margin ratio for the current year ended December 31.