On January 1, 2021, the general ledger of ACME Fireworks includes the following account balances: Credit Debit $ 25,100 46,200 $4,200 Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Land Equipment Accumulated Depreciation Accounts Payable Notes Payable (6%, due April 1, 2822) Common Stock Retained Earnings Totals 20,000 46,000 15,000 1,500 28,5ee 50,000 35,800 33, 100 $152, 300 $152,388 During January 2021, the following transactions occur January 2 Sold gift cards totaling $8,eee. The cards are redeemable for merchandise within one ye purchase date. Check my w January 2 Sold gift cards totaling $8,080. The cards are redeemable for merchandise within one year of the purchase date January 6 Purchase additional inventory on account, $147,000. January 15 Firework sales for the first half of the month total $135,00. All of these sales are on account. The cost of the units sold is 573,800 January 23 Receive $125,400 from customers on accounts receivable. January 25 Pay $9e,eee to inventory suppliers on accounts payable. January 28 Write off accounts receivable as uncollectible, $4,800 January 3 Firework sales for the second half of the month total $143,000. Sales include $11,000 for cash and $132,800 on account. The cost of the units sold is $79,50 January 31 Pay cash for monthly salaries, $S2,000. a. 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 $3,000 and a two-year service life. b. The company estimates future uncollectible accounts. The company determines $11,000 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 5% of these accounts are estimated to be uncollectible. (Hint Use the January 31 accounts receivable balance calculated in the general ledger) c. Accrued interest expense on notes payable for January d. Accrued income taxes at the end of January are $13,000 e. By the end of January, $3.000 of the gift cards sold on January 2 have been redeemed. 2 2. Record the adjusting entries on January 31 for the above transactions. (If no entry is rented select "No Journal Entry Required" in the first account field.) cular transaction event Journal entry worksheet Accrued income taxes at the end of January are $13,000. Note: Enter debits before credits. General Journal Debit Credit Date January 31 Journal entry worksheet 1 2 3 4 5 By the end of January, $3,000 of the gift cards sold on January 2 have been redeemed Note: Enter debits before credits. Date General Journal Debit Credit January 31
