General Products Inc is incorporated in Nevada, USA on Jan 1,2013 to takeover a local retail chain. The objective of the company is to supply goods of every day use to customers at the most competitive prices. General Products has chain of stores throughout USA. The retail operations of the company are so designed that customers can shop seamlessly in stores and online.

Balance Sheet of GeneralProducts Inc. on Dec 31, 2015

Assets

$ Current Assets

Cash and cash equivalent 11,980

Accounts Receivables 20,520

Inventory 317,060

Inventory of Premiums ( @$1.10 per premium) 660

Total Current Assets 350,220

Long Term Assets

Investments 66,775

Property Plant and Equipment 750,000

Less Accumulated Depreciation 90,000 660,000

Total Long Term Assets 726,775

Intangible Assets

Trade Marks 190,000

Total Assets 1,266,995

Liabilities and Shareholders' Equity

Current Liabilities

Accounts Payable 50,722

Liability for Premiums and Coupons 550

5% Short Term Notes Payable due on March 31,2016 8,000

Accrued Interest on 6% Bonds Payable 3,000

Total Current Liabilities 62,272

6% BondsPayable due 2020 100,000

Unamortized Discount on Bonds Payable 6,732 93,268

Total Liabilities 155,540

Stockholder's Equity

Common Stock 125,000 shares, par value $1authorized

100,000 shares issued and outstanding 130,000

Paid inCapital in Excess of Par 946,000

Retained Earnings 35,455

total nStockholders' Equity 1,111,455

Total Liabilities and Stockholders' Equity 1,266,995

1 Trades Marks were acquired for $200,000 in 2015.Estimated useful at the time of acquisition was 20years There was a litiagation brought out by a competitor against the Trade Mark. GeneralProduct could successfully defended this litigation at a cost of $ 45,000. Newuseful life of Trade Mark is estimated to be 25 years from the date of acquisition.

2 All sales are on credit and totalled $ 940,560. COGS are $780,650.

3 Included in the total sales of $940,560 are the sales of GeneralProducts brand 6000 soap powder boxes GeneralProducts includes one coupon in every soap powder box. Customers can redeem coupons for one Kitchen untensil.

4 Based on past experience 60% of the coupons are redeemed by customers. During 2016 3,400 coupons were redeemed. Purchase of premiums during 2016 totalled 1,000 premiums @ $1.10 each on credit. 4 6% Bonds Payable are issued on Jan 1 2015 to yield 8% interest. Interest is paid semiannualy on Jan 1st and June 30th. General Products can redeem these Bonds any time after June 30,2016 @ 101.

5 To take advantage of lower interst rates and to finance the redemption of 6% Bonds, on Sept.1st 2016, GeneralProducts issued 5%Bonds in theface value of $100,000to yield 6% The maturity period of these 5% Bonds is 10 years and interest is paid semiannually on 1st Jan and 30th June. The proceeds from the issue of 5% Bonds are used to redeem 6% Bonds Payable @ 101 on Sept.1st 2016.

6 Selling Administrative Expenses excluding depreciation are $87,345. PP&E is depreciated on Striaght Line Method over 25 years of life.

7 Cash collected from customers totalled $906,450

8 Cash paid to suppliers for credit purchases totalled $728,254

9 Purcahses of inventory totalled $ 689,525.All purchases are on credit.

10 GeneralProducts purchased Land for $30,000 for construction of building

Requirements

1 Record the necessary journal entries for 2016

2 Prepare Income Statement and Retained Earnings Statement for the year 2016

3 Prepare Balance Sheet on December 31,2016

4 Show full work of all the financial items reported in Income Statement and Balance Sheet.

Please round your calculations closest to $. Ignore tax.