Josh and Kelly McKay began operations of their furniture repair shop (Furniture Refinishers, Inc.) on January 1, 2016. The annual reporting period ends December 31. The trial balance on January 1, 2017, was as follows:

COMP4-2 Recording Transactions (Including Adjusting and Closing Entries). Preparing Financial Statements, and Performing Ratio Analysis LO4-1, 4-2, 4-3, 4-4 (GL) Josh and Kelly McKay began operations of their furniture repair shop (Furniture Refinishers, Inc.) on January 1, 2016. The annual reporting period ends December 31. The trial balance on January 1, 2017, was as follows: Debat Credit 7.000 11000 Account Titles Cash Accounts receivable Supplies Small tools Equipment Accumulated depreciation (on equipment) Other assets (not detailed to simplify) Accounts payable Notes payable Wages payable Interest payable Income taxes payable Unearned revenue Common stock (70.000 shares $0.10 par value) Additional paid-in capital Retained earnings Service revenue Depreciation expense Wages expense Interest expense Income tax expense Remaining expenses (not detailed to simplify) Totals 7.000 12.000 Transactions during 2017 follow: a. Borrowed $40,000 cash on July 1, 2017, signing a one-year, 10 percent note payable. b. Purchased equipment for $22,000 cash on July 1, 2017 c. Sold 10,000 additional shares on January 1, 2017, of capital stock for cash at $.50 market value per share at the beginning of the year. d. Earned $172,000 in revenue. Transactions dated August 15, 2017, including $66,000 on credit and the rest in cash. e. Incurred remaining expenses of $58,000, invoices dated September 15, 2017 including $8,000 on credit and the rest paid in cash. f. Purchased additional small tools on September 23, 2017, $8,000 cash. g. Collected accounts receivables on October 6, 2017. $8,000. h. Paid accounts payable on November 11, 2017, $16,000. i. Purchased $27,000 of supplies on account on November 30, 2017. j. Received a $6,000 deposit on December 2, 2017, for work to start January 15, 2018. k. Declared and paid cash dividends on December 17th, $18,000. Data for adjusting entries: 1. Supplies of $5,000 and small tools of $9,000 were counted on December 31, 2017 (debit Remaining Expenses). m. Depreciation for 2017. $6,000. n. Interest accrued on notes payable (to be computed). o. Wages eamed since the December 24 payroll but not yet paid, $9,000. p. Income tax expense was $9,000, payable in 2018. Data for adjusting entries: 1. Supplies of $5,000 and small tools of $9,000 were counted on December 31, 2017 (debit Remaining Expenses). m. Depreciation for 2017, $6,000. n. Interest accrued on notes payable (to be computed). o. Wages earned since the December 24 payroll but not yet paid, $9,000. p. Income tax expense was $9,000, payable in 2018. Recurement General Journal General Ledger Trial Balance de Income Statement Statement of SE Balance Sheet St of cash flows Analysis General Journal tab - (Step 1) Prepare the journal entries to record the transactions (1) through (11). Review the accounts as shown in the General Ledger and Trial Balance tabs. (Step 2) Prepare the necessary adjusting entries (12) through (16) to correctly report net income for the period. (Step 3) After preparing the financial statements, record the closing entry (17). Notice the effect on the trial balance, income statement, and balance sheet tabs once the closing entry is posted. General Ledger tab - Each journal entry is posted automatically to the General Ledger. Use the drop-down button to view the unadjusted, adjusted, or post-closing balances in the General Ledger. Trial Balance tab - You may view either the unadjusted, adjusted, or post-closing trial balance by choosing from the drop-down. Your choice will determine the reported values on the financial statement tabs. Income Statement tab - Use the drop-downs to select the accounts that should be properly included on the Income Statement. Compute earnings per share. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. Statement of Stockholders' Equity tab - Use the drop-downs to select the accounts that should be properly included on the Statement of Stockholders' Equity and enter the appropriate amounts. Balance Sheet tab - Use the drop-downs to select the accounts that should be properly included on the Balance Sheet. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. Statement of Cash Flows tab - For each transaction, identify the appropriate cash flow classification (if any) and the transaction's impact on cash. Analysis tab - Calculate the current ratio, total asset turnover ratio, and net profit margin ratio for 2017. General Journal > Requirement General Journal General Ledger Income Trial Balance hice Statement Statement of SE Balance Sheet St of cash flows Analysis Prepare journal entries for transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Transaction Type of Effect on Cash Flows Direction and Amount of Effect a. Compute the current ratio for 2017. Current ratio b. Compute the total asset turnover ratio for 2017. Total asset turnover c. Compute the net profit margin ratio for 2017. Net profit margin