Ivanhoe Company's balance sheet at December 31, 2021. is presented below. Ivanhoe Company Balance Sheet December 31, 2021 Cash $13,890 Accounts payable Accounts receivable 19,400 Common stock Allowance for doubtful accounts (750) Retained earnings Inventory 9,080 $41.620 $8,120 20,800 12,700 $41.620 During January 2022, the following transactions occurred, Ivanhoe uses the perpetual inventory method Jan. 1 3 Ivanhoe accepted a 4-month. 8% note from Betheny Company in payment of Betheny's $1,200 account. Ivanhoe wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300). Ivanhoe purchased $15,630 of inventory on account. Ivanhoe sold for $25,500 on account inventory that cost $17.210. 8 11 11 15 17 Ivanhoe sold for $25,500 on account inventory that cost $17.210, Ivanhoe sold inventory that cost $730 to Jack Rice for $1,100. Rice charged this amount on his Visa First Bank card. The service fee charged Ivanhoe by First Bank is 3% Ivanhoe collected $21.000 from customers on account. Ivanhoe paid $17.380 on accounts payable. Ivanhoe received payment in full ($300) from Drake Company on the account written off on January 3. Ivanhoe purchased advertising supplies for $1.420 cash. Ivanhoe paid other operating expenses. $3,280. 21 24 27 31 Adjustment data: 1. 2 3. Interest is recorded for the month on the note from January 1. Bad debts are expected to be 6% of the January 31, 2022, accounts receivable. A count of advertising supplies on January 31, 2022, reveals that $600 remains unused. The income tax rate is 30%. (Hint: Prepare the income statement up to Income before taxes and multiply by 30% to compute the amount: round to whole dollars.) 4 [You may want to set up T-accounts to determine ending balances) Debit Account Titles and Explanation Notes Receivable Credit 1200 Accounts Receivable 1200 Allowance for Doubtful Accounts 800 Accounts Receivable 800 Inventory 15630 Accounts Payable 15630 Accounts Receivable 25500 25500 Sales Revenue (To record sales revenues.) Cost of Goods Sold 17210 17210 Inventory Cash 1067 Service Charge Expense 33 Sales Revenue 1100 (To record sales revenues and service charges.) Cost of Goods Sold 730 730 Inventory (To record cost of goods sold) Cash 21000 Accounts Receivable 21000 Accounts Payable 17380 Cash 17180 300 Accounts Receivable Acant 3.11 / 5 Allowance for Doubtful Accounts 300 (To reverse allowance for doubtful debts.) Casti 300 300 Accounts Receivable (To record cash received from Drake Company) Supplies 1420 Cash 1420 Other Operating Expenses 3280 Cash 1280 > (1) Interest Receivable Interest Revenue (2) Bad Debts Expense Allowance for Doubt Acounts to search IN O F12 DEL F11 FO FS F7 VO FO FB F2 F3 A & * % W # $ 4 7 8 09 6 2 5 Y T U w R (2) Bad Debts Expense 3.11 /5 Allowance for Doubtful Accounts (3) Supplies Expense Supplies (4) Income Tax Expense Income Taxes Payable IVANHOE COMPANY Adjusted Trial Balance January 31, 2022 Debit Credit Cash Inventory Supplies Interest Receivable Notes Receivable Accounts Receivable Allowance for Doubtful Accounts Accounts Payable Income Taxes Payable Common Stock Retained Earnings Sales Revenue Interest Revenue Cost of Goods Sold Service Charge Expense Other Operating Expenses Bad Debts Expense Supplies Expense Income Tax Expense Totals IVANHOE COMPANY Income Statement For the Month Ending January 31, 2022 Sales Revenues Cost of Goods Sold Gross Pront Operating Expenses Other Operating Expenses $ Bad Debts Expense Supplies Expense Service Charge Expense Total Operating Expenses Question 2 of 2 3.11/5 Service Charge Expense Total Operating Expenses V Income From Operations Interest Revenue Income Before Income Taxes Income Tax Expense Net Income /(Loss) Prepare a retained earnings statement for the month ending January 31, 2022. (Round answers to O decimal places, eg. 1,250.) IVANHOE COMPANY Retained Earnings Statement For the Month Ending January 31, 2022 Retained Earnings, January 1 Add vi Net Income /(L055 Retained Earnings, January 31 $ - IVANHOE COMPANY Balance Sheet January 31, 2022 Assets Current Assets Cash Less $ Total Assets Liabilities and Stockholders' Equity Current Liabilities Accounts Payable $ Income Taxes Payable Total Liabilities Stockholders' Equity Common Stock $ Retained Eamings Total Stockholders' Equity Total Liabilities and Stockholders' Equity $