On January 1, 2021, the general ledger of Dynamite Fireworks includes the following account balances: Accounts Cash Accounts Receivable Supplies Land Accounts Payable Common Stock Retained Earnings Totals Debit Credit $24,300 5,700 3,600 55,000 $ 3,700 70,000 14,900 $88,600 $88,600 During January 2021, the following transactions occur: January 2 Purchase rental space for one year in advance, $7,500 ($625/month). January 9 Purchase additional supplies on account, $4,000. January 13 Provide services to customers on account, $26,000. January 17 Receive cash in advance from customers for services to be provided in the future, $4,200. January 20 Pay cash for salaries, $12,000. January 22 Receive cash on accounts receivable, $24,600. January 29 Pay cash on accounts payable, $4,500. The following information is available on January 31. Rent for the month of January has expired. Supplies remaining at the end of January total $3,300. By the end of January, $3,575 of services has been provided to customers who paid in advance on January 17. Unpaid salaries at the end of January are $5,450. General General Trial Income Balance Require... Journal Ledger Balance Statem... Analysis Sheet 1. Record each of the transactions listed above in the 'Ge Balance Sheet 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. 4. 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. General General Trial Income Balance Require... Journal Ledger Balance Statem... Analysis Sheet Prepare the journal entries for transactions. If no entry is required for a particular transaction/event, select "No journal entry required" in the first account field. View transaction list View journal entry worksheet Account Title Credit No 1 Date Jan 02 Debit 7,500 Prepaid Rent Cash 7,500 2 Jan 09 4,000 Supplies Accounts Payable 4,000 3 Jan 13 26,000 Accounts Receivable Service Revenue 26,000 4 Jan 17 4,200 Cash Deferred Revenue 4,200 5 Jan 20 Salaries Expense Cash 12,000 12,000 Jan 22 Jan 22 24,600 Cash Accounts Receivable 24,600 7 Jan 29 4,500 Accounts Payable Cash 4,500 8 Jan 31 625 Rent Expense Prepaid Rent 625 9 Jan 31 4,300 Supplies Expense Supplies 4,300 , 10 10 Jan 31 3,575 Deferred Revenue Service Revenue 3,575 11 Jan 31 5,450 Salaries Expense Salaries Payable 5,450 12 Jan 31 29,575 Service Revenue Retained Earnings 29,575 13 Jan 31 22,375 Retained Earnings Salaries Expense Supplies Expense Rent Expense 17,450 4,300 625 Require... Journal General General Trial Income Balance Analysis Ledger Balance Statem... Sheet Prepare an income statement for the period ended January 31, 2021. Choose the appropriate accounts to complete the company's income statement. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. Show less Post-closi Dynamite Fireworks Income Statement For the year ended January 31, 2021 Revenues: 0 Total Revenue Expenses: Total Expenses 0 $ 0 Require... General Journal General Ledger Trial Income Balance Statem... 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. Show less Post-closi Dynamite Fireworks Balance Sheet January 31, 2021 Liabilities Current Liabilities: Assets Current Assets: Total Current Liabilities 0 0 0 Total Current Assets Long-term Assets: Total Liabilities Stockholders' Equity 0 0 0 0 Total Assets Total Stockholders' Equity Total Liabilities & Stockholders' $ 0 Equity $ 0 The following information is available on January 31. Rent for the month of January has expired. Supplies remaining at the end of January total $3,300. By the end of January, $3,575 of services has been provided to customers who paid in advance on January 17. Unpaid salaries at the end of January are $5,450. General General Trial Income Balance Require... Journal Analysis Ledger Balance Statem... Sheet Using the information from the requirements above, complete the 'Analysis' tab. Analysis 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 appear to be in good or bad financial condition?
