Ivanhoe Fabrications Ltd. sells greenhouse kits to retailers and garden centres. The company's post-closing trial balance at December 31, 2020, the end of its fiscal year, is presented below: IVANHOE FABRICATIONS LTD. Post-Closing Trial Balance December 31, 2020 Debit Credit Cash $138,240 Accounts receivable 993,600 Supplies 3,240 Inventory 493,560 Equipment 2,462,400 Accumulated depreciation-equipment $410,400 Accounts payable 442,800 Interest payable Salaries payable Deferred revenue Bank loan payable Common shares Retained earnings 5,400 36,720 129,600 2,160,000 270,000 636,120 $4,091,040 $4,091,040 Ivanhoe had the following transactions during January 2021: Jan. 1 8 The bank loan bears interest at 3% and requires monthly payments on the first day of the month consisting of principal of $21,600 plus interest. The interest for December 2020 was properly accrued at the end of 2020. Received payments of $192,240 from customers in payment of their accounts. Made sales on account totalling $233,280 to garden centres. The greenhouse units sold had cost Ivanhoe $131,760. 13 15 Purchased additional greenhouse kits from a supplier on account for $81,000. 17 Paid accounts payable that were due to creditors totalling $129,600. 18 Paid salaries of $75,600, which included the accrued salaries owing at the end of 2020 and $38,880 related to salaries earned to date in January. 21 Purchased supplies on account for $1,620. 24 26 31 Received a shipment of additional greenhouses from a supplier. The invoice for $105,840 is due in 30 days. Made sales of $136,080, of which $62,640 was on account and the remainder was cash. The cost of the greenhouses sold was $73.440. Delivered a custom greenhouse that a customer had ordered and put a $27,000 deposit down on. The total sales price was $54,000 and the greenhouse had cost Ivanhoe $37,800. The customer paid the outstanding balance in cash. Ivanhoe reconciles its bank account at the end of every month and makes any necessary journal entries. The following information was gathered from reviewing the company's bank statement for the month of January: 1. There were outstanding cheques of $12,960. 2. The service charges on the account were $44 for the month. 3. 4. A deposit for $27,000 was made using the bank's night depository slot on January 31. This deposit is not reflected on the company's bank statement for January. A cheque from one of Ivanhoe's customers for $10,584 that had been deposited during the month was returned by the bank due to the customer having insufficient funds in their account. 5. The company's account balance at January 31 was $195,652 according to the bank statement. Ivanhoe records adjustments monthly on the last day of the month. Adjusting entries were required for the following: 1. Record depreciation on the equipment assuming that Ivanhoe uses the straight-line method to depreciate its equipment and the equipment is expected to have a useful life of six years. 2. Accrue interest for the month on the bank loan. 3. When supplies were counted, it was determined that supplies with a cost of $1,404 were still on hand. 4. Accrued salaries payable are $38,880. 5. The company earned $60,480 of the deferred revenue. The cost of the goods sold was $42,120. 6. The estimated income taxes owing for the month of January was $17,280. Jan. 1 Jan. 8 Jan. 13 3 Jan. 15 v (To record sale) Jan. 17 (To record cost of goods sold) Jan. 18 Jan. 24 Jan. 26 Jan. 26 Jan. 31 (To record sale on account) Jan. 31 (To record cost of goods sold) Jan. 31 v (To record sale) (To record cost of goods sold)