Hassellhouf Company's trial balance at December 31, 2020, is as follows. All 2020 transactions have been recorded except for the items described following the trial balance. Cash Accounts Receivable Notes Receivable Interest Receivable Inventory Prepaid Insurance Land Buildings Equipment Patents Allowance for Doubtful Accounts Accumulated Depreciation-Buildings Accumulated Depreciation-Equipment Accounts Payable Salaries and Wages Payable Unearned Rent Revenue Notes Payable (due in 2018) Interest Payable Notes Payable (due after 2018) Owner's Capital Owner's Drawings Sales Revenue Interest Revenue Rent Revenue Gain on Disposal of Plant Assets Bad Debts Expense Cost of Goods Sold Depreciation Expense Insurance Expense Debit $25,000 37,000 8,800 0 36,200 4,500 20,000 136,200 60,500 9,200 12,500 0 639,000 0 0 Credit $550 45,400 24,200 27,000 0 1,800 12,000 0 35,500 109,750 901,000 0 0 0 Rent Revenue Gain on Disposal of Plant Assets Bad Debts Expense Cost of Goods Sold Depreciation Expense Insurance Expense Interest Expense Other Operating Expenses Amortization Expense Salaries and Wages Expense Total 1. 2. 5. 6. 7. 8. 9. 0 639,000 10. 11. 12. 13. 0 0 0 61,300 0 Unrecorded transactions: On May 1, 2020, Hassellhouf purchased equipment for $15,900 plus sales taxes of $900 (all paid in cash). On July 1, 2020, Hassellhouf sold for $3,500 equipment which originally cost $5,100. Accumulated depreciation on this equipment at January 1, 2020, was $1,800; 2020 depreciation prior to the sale of the equipment was $450. On December 31, 2020, Hassellhouf sold on account $5,000 of inventory that cost $3,300. 3. 4. Hassellhouf estimates that uncollectible accounts receivable at year-end is $4,000. The note receivable is a one-year, 8% note dated April 1, 2020. No interest has been recorded. The balance in prepaid insurance represents payment of a $4,500 6-month premium on September 1, 2020. The building is being depreciated using the straight-line method over 30 years. The salvage value is $33,000. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost. 107,000 $1,157,200 0 0 $1,157,200 The equipment purchased on May 1, 2020, is being depreciated using the straight-line method over 5 years, with a salvage value of $2,400. The patent was acquired on January 1, 2020, and has a useful life of 10 years from that date. Unpaid salaries and wages at December 31, 2020, total $2,100. The unearned rent revenue of $1,800 was received on December 1, 2020, for 3 months' rent. Both the short-term and long-term notes payable are dated January 1, 2020, and carry a 9% interest rate. All interest is payable in the next 12 months. Prepare journal entries for the transactions listed above. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Debit No. 1. 3. 2. Depreciation Expense 4. Account Titles and Explanation Equipment 5. Cash Accumulated Depreciation-Equipment (To record depreciation expense.) Cash Accumulated Depreciation-Equipment Equipment Gain on Disposal of Plant Assets (To record sale of equipment.) Accounts Receivable Sales Revenue (To record sales revenue.) Cost of Goods Sold Inventory (To record cost of goods sold.) Bad Debt Expense Allowance for Doubtful Accounts Interest Receivable 16800 3500 2250 5000 11 4000 528 Credit 16800 650 5100 5000 4000 5. 6. 7. 8. 9. 10. 11. 12. 13. Interest Receivable Interest Revenue Insurance Expense Prepaid Insurance Depreciation Expense Accumulated Depreciation-Buildings Depreciation Expense Accumulated Depreciation-Equipment Depreciation Expense Accumulated Depreciation-Equipment Amortization Expense Patents Salaries and Wages Expense Salaries and Wages Payable Unearned Rent Revenue Rent Revenue Interest Expense Interest Payable 528 3000 3440 3440 1920 920 2100 1800 4275 528 3000 3440 3440 1920 920 2100 1800 4275 Cash Accounts Receivable Notes Receivable Interest Receivable Inventory Prepaid Insurance Land Buildings Equipment Patents Allowance for Doubtful Accounts Accumulated Depreciation-Buildings Accumulated Depreciation-Equipment Accounts Payable Salaries and Wages Payable Unearned Rent Revenue Notes Payable HASSELLHOUF COMPANY Trial Balance December 31, 2020 10 Debit 45300 42000 8800 528 32900 1500 20000 136200 72200 8280 40 Credit 4000 23092 41960 27000 2100 1200 1200 Interest Payable Sales Revenue Interest Revenue Rent Revenue Gain on Disposal of Plant Assets Bad Debt Expense Cost of Goods Sold Depreciation Expense Insurance Expense Interest Expense Other Operating Expenses Amortization Expense Salaries and Wages Expense Total 4000 642300 6918 3000 4275 61300 920 109100 1199521 4275 906000 528 600 650 1199521 Prepare a 2020 income statement. V HASSELLHOUF COMPANY Income Statement s