Question
On January 1, 2018, the general ledger of ACME Fireworks includes the following account balances: Account Debit Credit Cash $25,200 Accounts Receivable 46,400 Allowance for
On January 1, 2018, the general ledger of ACME Fireworks includes the following account balances:
Account | Debit | Credit |
Cash | $25,200 | |
Accounts Receivable | 46,400 | |
Allowance for Uncollectible Accounts | $4,300 | |
Inventory | 20,100 | |
Land | 47,000 | |
Equipment | 16,000 | |
Accumulated Depreciation | 1,600 | |
Accounts Payable | 28,600 | |
Notes Payable (6%, due April 1, 2019) | 51,000 | |
Common Stock | 36,000 | |
Retained Earnings | 33,200 | |
Totals | 154,700 | 154,700 |
During January 2018, the following transactions occur:
January 2. Sold gift cards totaling $8,200. The cards are redeemable for merchandise within one year of the purchase date.
January 6. Purchase additional inventory on account, $148,000.
January 15. Firework sales for the first half of the month total $136,000. All of these sales are on account. The cost of the units sold is $74,300.
January 23. Receive $125,500 from customers on accounts receivable.
January 25. Pay $91,000 to inventory suppliers on accounts payable.
January 28. Write off accounts receivable as uncollectible, $4,900.
January 30. Firework sales for the second half of the month total $144,000. Sales include $10,000 for cash and $134,000 on account. The cost of the units sold is $80,000.
January 31. Pay cash for monthly salaries, $52,100
The following information is available on January 31.
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Depreciation on the equipment for the month of January is calculated using the straight-line method. At the time the equipment was purchased, the company estimated a residual value of $3,400 and a two-year service life.
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The company estimates future uncollectible accounts. The company determines $12,000 of accounts receivable on January 31 are past due, and 30% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 4% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)
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Accrued interest expense on notes payable for January.
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Accrued income taxes at the end of January are $13,100.
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By the end of January, $3,100 of the gift cards sold on January 2 have been redeemed (ignore cost of goods sold).
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Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 - 10) assuming a FIFO perpetual inventory system. The transactions on January 15 and January 30 require two entries: one to record sales revenue and one to record cost of goods sold. Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances.
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Record adjusting entries on January 31. in the General Journal.
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Review the adjusted trial balance as of January 31, 2021
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Prepare a multi step income statement for the period ended January 31, 2021
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Prepare a a classified balance sheet as of January 31, 2021
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Record the closing entries in the General Journal tab
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Using the information from the requirements above, complete the analysis tab
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