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On January 1, 2021, the general ledger of 3D Family Fireworks includes the following account balances: Accounts Cash Debit $ 25,500 Credit Accounts Receivable
On January 1, 2021, the general ledger of 3D Family Fireworks includes the following account balances: Accounts Cash Debit $ 25,500 Credit Accounts Receivable 14,400 Allowance for Uncollectible Accounts $ 2,400 Supplies 3,300 Notes Receivable (6%, due in 2 years) 28,000 Land 77,800 Accounts Payable Common Stock 9,400 104,000 Retained Earnings 33,200 Totals $149,000 $149,000 During January 2021, the following transactions occur: January 2 Provide services to customers for cash, $43,100. January 6 Provide services to customers on account, $80,400. January 15 Write off accounts receivable as uncollectible, $2,000. January 20 Pay cash for salaries, $32,200. January 22 Receive cash on accounts receivable, $78,000. January 25 Pay cash on accounts payable, $6,300. January 30 Pay cash for utilities during January, $14,500. The following information is available on January 31, 2021. a. The company estimates future uncollectible accounts. The company determines $5,800 of accounts receivable on January 31 are past due, and 20% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.) b. Supplies at the end of January total $650. c. Accrued interest revenue on notes receivable for January. Interest is expected to be received each December 31. d. Unpaid salaries at the end of January are $34,300.
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