On January 1, 2021, the general ledger of Dynamite Fireworks includes the following account balances: Credit Accounts Cash Accounts Receivable Supplies Land Accounts Payable Common Stock Retained Earnings Totals Debit $24,800 6,200 4,100 60,000 $ 4,200 75,000 15,900 $95,100 $95,100 During January 2021, the following transactions occur: January 2 Purchase rental space for one year in advance, $9,000 ($750/month). January 9 Purchase additional supplies on account, $4,500. January 13 Provide services to customers on account, $26,500. January 17 Receive cash in advance from customers for services to be provided in the future, $4,700. January 20 Pay cash for salaries, $12,500. January 22 Receive cash on accounts receivable, $25,100. January 29 Pay cash on accounts payable, $5,000. The following information is available on January 31. . Supplies remaining at the end of January total $3,800. By the end of January, $3,950 of services has been provided to customers who paid in advance on January 17. Unpaid salaries at the end of January are $5,100. Requirement General Journal General Ledger Trial Balance Income Statement Balance Sheet Analysis 1. Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 - 7). Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances. 2. Record the adjusting entries in the 'General Journal' tab (these are shown as items 8-11). 3. Review the adjusted 'Trial Balance' as of January 31, 2021. Prepare an income statement for the period ended January 31, 2021, in the 'Income Statement' tab. 5. Prepare a classified balance sheet as of January 31, 2021 in the 'Balance Sheet' tab. 6. Record the closing entries in the 'General Journal' tab (these are shown as items 12 and 13). 7. Using the information from the requirements above, complete the 'Analysis' tab. Requirement General Journal General Ledger Trial Balance Income Statement Balance Sheet Analysis Prepare a classified balance sheet as of January 31, 2021. Choose the appropriate accounts to complete the company's balance sheet. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. Unadjusted Dynamite Fireworks Balance Sheet January 31, 2021 Assets Liabilities Current Assets: Current Liabilities: Total Current Liabilities Total Liabilities Total Current Assets Long-term Assets: Stockholders' Equity Total Stockholders' Equity Total Liabilities & Stockholders' Equity Total Assets Requirement General Journal General Ledger Trial Balance Income Statement Balance Sheet Analysis Using the information from the requirements above, complete the 'Analysis' tab. Analyze the following features of Dynamite Fireworks' financial condition: (a) What is the amount of profit reported for the month of January? The amount of profit reported for the month of January is (b) Calculate the ratio of current assets to current liabilities at the end of January The ratio of current assets to current liabilities at the end of January is (c) Based on Dynamite Fireworks' profit and ratio of current assets to current liabilities, indicate whether Dynamite Fireworks appears to be in good or bad financial condition. Does the company appears to be in good or bad financial condition?
