Instructions:

$1.$ Prepare journal entries for each event.

$2.$ Prepare adjusting entries.

$3.$ Prepare adjusted trial balance.

$4.$ Prepare income statement, retained earnings statement and balance sheet.

$5.$ Prepare closing entries.

CAPTAIN FISHING INC.

BALANCE SHEET

DECEMBER $31,2023$

Current Assets

Cash $42,800$

Notes Receivable $16,000$

Accounts Receivable $41,800$

Less: Allowance for Doubtful Accounts $(3,000)$

Inventories $42,000$

Prepaid Insurance $840$

Total Current Assets $140,440$

Non$-$Current Assets

Long$-$term Investments

Investments in held$-$for$-$maturity securities $51,000$

Land held for future development $45,500$

Property, Plant, and Equipment

Land $85,000$

Buildings $675,000$

Less: Accumulated Depreciation $(187,500)$

Intangible Assets

Capitalized Development Costs $8,000$

Goodwill $76,000$

Other Identifiable Intangible Assets $48,000$

Total Non$-$Current Assets $801,000$

Total Assets $941,440$

Current Liabilities

Notes Payable $130,000$

Accounts Payable $33,500$

Unearned Revenues $17,000$

Income Taxes Payable $9,440$

Property Taxes Payable $6,600$

Interest Payable $1,800$

Total Current Liabilities $198,340$

Non$-$Current Liabilities

Provisions Related to Pensions $93,100$

Bonds Payable $300,000$

Total Non$-$Current Liabilities $393,100$

Total Liabilities $591,440$

Stockholders' Equity

Common Stock $100,000$

Preferred Stock $100,000$

Paid$-$in$-$capital $-$ Common Stock $27,500$

Paid$-$in$-$capital $-$ Preferred Stock $10,000$

Retained Earnings $120,250$

Accumulated Other Comprehensive Income $5,000$

Less: Treasury Stock $(12,750)$

Total Stockholders' Equity $350,000$

Total Liabilities and Stockholders' Equity $941,440$

The balance sheet of the Captain Fishing Inc. is attached. During $2024,$ the following events occurred.

$1.$ On January $10,$ sold merchandise on account to Rayms $$8800$ and Fischer $$7500.$ Terms $2/10,$ n$/30.$

$2.$ On January $12,$ purchased merchandise on account from Zapfel $$3600$ and Liotta $$2600.$ Terms $1/10,$ n$/30.$

$3.$ On January $14,$ received checks, $$4700$ from Longhini and $$2500$ from Hall, for sales on account after discount period has lapsed.

$4.$ On January $15,$ sent checks to Joosten for $$8600$ less $3\%$ cash discount, and to Maida for $$10000$ less $2\%$ cash discount.

$5.$ On January $16,$ issued credit of $$550$ to Fischer for merchandise returned.

$6.$ On January $21,$ paid off the balances to Zapfel and Liotta for the purchases made on January $12.$

$7.$ On Feburary $9,$ received payment in full from Rayms and Fischer.

$8.$ On March $1,$ paid rent of $$8400$ for a two$-$year term starting from July $1,2024.$

$9.$ On April $1,$ the company CEO paid $$49000$ from her savings bank account to purchase a car for personal use.

$10.$ On April $12,$ paid $$785$ cash for office supplies and expensed immediately.

$11.$ Cash dividends totaling $$1433$ were declared on June $13$ and paid to stockholders on June $23.$

$12.$ Issued a note of $$110000$ to bank $($one year, annual interest rate $5\%)$ for cash on July $1.$

$13.$ On July $5,$ purchased merchandise from Maida $$33000$ terms $3/10,$ n$/30.$

$14.$ On July $7,$ issued common stock $1150$ shares, $$10$ par, in exchange of a land with a fair market value of $$16000.$

$15.$ On July $8,$ returned $$327$ of merchandise to Maida and received credit.

$16.$ On August $1,$ sold merchandise to Lachey on account $$83800,$ term $1/10,$ n$/30.$

$17.$ Paid off the balance to Maida on August $4.$

$18.$ On Auguest $8,$ paid utilities expense, $$10324.$

$19.$ On August $18,$ Lachey paid off its balance.

$20.$ On September $1,$ paid cash $$7550$ to Farmington for merchandise purchased last year.

$21.$ On October $1,$ paid off notes payable $$130000($issued in $2023)$ and associated interest $$6000($this amount includes $$1800$ interest payable on the balance sheet$).$

$22.$ Over the year, cash sales to other retail customers were $$16332.$

$23.$ Over the year, sales and office employees earned $$24800$ in salaries and wages, of which $$2480$ remained as payable at the end of year.

$24.$ On Dec $31,$ received an utilities bill of $$1350($for December $2024)$ and paid off the bill on January $10,2025.$

$25.$ On Dec $31,$ paid $5\%$ interest on bonds payable.

Additional Information at the end of the year:

$1.$Depreciation expense for the year was $$11780.$

$2.$ The company estimated that it will pay federal income tax, $$1746.$

$3.$ After physically counting, the company decided that the ending inventories was $$25,520.$

$4.$ Based on its historical data, the bad debts expense are about $$1370.$

$5.$ Unearned revenue was decreased by $$10420.$

$6.$ The company expenses all of the supplies purchased during the year.

$7.$ No insurance policy was effective during the year $($will be effective from Jan $1,2025).$

$8.$ The company uses the gross method to record its purchases and sales on credit.

$9.$ The company adopts the perpetual inventory system.

$10.$ Rayms, Fischer, and Lachey had zero balance on account as of Jan $1,2024.$

$11.$ Gross profit margin is $0\mathrm{.}6$