On January 1, 2018, the general ledger of 3D Family Fireworks includes the following account balances:

Accounts

Debit

Credit

Cash

$ 21,900

Accounts Receivable

36,500

Inventory

30,000

Land

61,600

Allowance for Uncollectible Accounts

$ 3,100

Accounts Payable

32,400

Notes Payable (8%, due in 3 years)

30,000

Common Stock

56,000

Retained Earnings

28,500

Totals

$150,000

$150,000

The $30,000 beginning balance of inventory consists of 300 units, each costing $100. During January 2018, Big Blast Fireworks had the following inventory transactions:

January 3	Purchase 1,200 units for $126,000 on account ($105 each).
January 8	Purchase 1,300 units for $143,000 on account ($110 each).
January 12	Purchase 1,400 units for $161,000 on account ($115 each).
January 15	Return 100 of the units purchased on January 12 because of defects.
January 19	Sell 4,000 units on account for $600,000. The cost of the units sold is determined using a FIFO perpetual inventory system.
January 22	Receive $580,000 from customers on accounts receivable.
January 24	Pay $410,000 to inventory suppliers on accounts payable.
January 27	Write off accounts receivable as uncollectible, $2,500.
January 31	Pay cash for salaries during January, $128,000.

1. Purchase 1,200 units for $126,000 on account ($105 each).

2. Purchase 1,300 units for $143,000 on account ($110 each).

3. Purchase 1,400 units for $161,000 on account ($115 each).

4. Return 100 of the units purchased on January 12 because of defects.

5. Sell 4,000 units on account for $600,000.

6. The cost of the units sold is determined using a FIFO perpetual inventory system.

7. Receive $580,000 from customers on accounts receivable.

8. Pay $410,000 to inventory suppliers on accounts payable.

9. Write off accounts receivable as uncollectible, $2,500.

10. Pay cash for salaries during January, $128,000.

11.Record the adjustment of inventory for market below cost. At the end of January, the company estimates that the remaining units of inventory are expected to sell in February for only $100 each.

12. Record the adjustment needed for the allowance for uncollectible accounts at the end of January. At the end of January, $4,000 of accounts receivable are past due, and the company estimates that 40% of these accounts will not be collected. Of the remaining accounts receivable, the company estimates that 4% will not be collected.

13. Record the adjustment for interest expense. Accrued interest expense on notes payable for January.

14. Record the adjustment for income expense. Accrued income taxes at the end of January are $12,300.

15. Record the entry to close the revenue accounts.

16. Record the entry to close the expense accounts.