On January 1, 2021, the general ledger of Parts Unlimited includes the following account balances: Credit Accounts Cash Accounts Receivable Inventory Land Equipment Accumulated depreciation Accounts Payable Common stock Retained Earnings Totals Debit $176,400 26,400 51,800 354, eee 380,500 $186,000 28,800 534,000 240,300 $989, 100 $989,100 From January 1 to December 31, the following summary transactions occurred: a. Purchased inventory on account, $339,800. b. Sold inventory on account. $621,200. The inventory cost $356,600. C. Received cash from customers on account. $572.700. d. Paid cash on account. $342.500. e. Paid cash for salaries, $108,700, and for utilities. $66,700. In addition, Parts Unlimited had the following transactions during the year: April 1Purchased equipment for $109, eee using a note payable, due in 12 months plus 8% interest. The company also paid cash of $4,600 for freight and $5,208 for installation and testing of the equipment. The equipment has an estimated residual value of $16,800 and a ten-year service life. June 30 Purchased a patent for $54, eee from a third-party marketing company related to the packaging of the company's products. The patent has a 20-year useful life, after which it is expected to have no value. October 1 Sold equipment for $45,600. The equipment cost $74,700 and had accumulated depreciation of $51,400 at the beginning of the year. Additional depreciation for 2021 up to the point of the sale is $9,900. (Hint: Total accumulated depreciation equals the amount at the beginning of the year plus the amount recorded for the current year.) November 15 Several older pieces of equipment were improved by replacing major components at a cost of $68,100. These improvements are expected to enhance the equipment's operating capabilities. [Record this transaction using Alternative 2-capitalization of new cost.] Year-end adjusting entries: a. Depreciation on the equipment purchased on April 1, 2021, calculated using the straight line method b. Depreciation on the remaining equipment. $35,500. c. Amortization of the patent purchased on June 30, 2021, using the straight line method d. Accrued interest payable on the note payable e. Equipment with an original cost of $80.800 had the following related information at the end of the year: accumulated depreciation of $51.500, expected cash flows of $29.700, and a fair value of $17.800. Accrued income taxes at the end of the year are $26,600 Journal entry worksheet 2 3 4 5 6 7 8 ..... 19 Record the purchase of inventory on account, $339,800. Note: Enter debits before credits. Date General Journal Debit Credit Jan 01 explanation Record entry Clear entry View general journal Unadjusted - General Ledger Account Cash Accounts receivable Debit Credit 1 No Date Debit Credit Balance Date Balance 26.400 17600 Inventory Land Debit Date Debit Credit Balance No Date Credit Balance 354,000 Equipment Debit Accumulated depreciation Debit Credit No Date Credit * Balance No. Balance Date 380.500 100.000 Common stock Accounts payable Debit Credit + Debit Credit Balance 20.800 Balance 514.000 Retained earnings Debit Date Credit Balance 240.300) Parts Unlimited Trial Balance November 15, 2021 Account Title Debit Credit Cash Account cevable 178,400 26 400 51,800 354000 inventory Quand Equipment 380 500 186 000 28 300 534 000 Accumulated depreciation Accounts payable Common stock Roland earnings Total 240 300 989 100 $ 989.100 Parts Unlimited Balance Sheet December 31, 2021 Liabilities Total Cuentos Total liabilities Noncurrentes Stockholders'equity Total stockholders' equity Totallaties and stockholders' equity USM ule places.) urmation from the requirements above, complete the 'Analysis'. (Round "fixed asset turnover ratio" answer to 2 decimal Analyze how well TNT Fireworks manages its assets: (a) Calculate the fixed asset turnover ratio for the year, using the total amount of property, plant, and equipment (net of accumulated deprecation) If the industry average fixed asset turnover is 0.75, is the company more or less efficient at generating sales with its foced assets than other companies in the same industry? (Hint: For the amount of fixed assets, use the net amount of all tangible long term assets) The fixed asset turnover ratio is The company is more efficient managing its inventory (True or False) (b) Suppose the equipment purchased on April 1, 2021, had been depreciated using the units of production method. At the time of purchase expected output was 20.000 units and actual production for 2021 was 3.000 units Calculate the amount of depreciation expense that would have been recorded and determine the difference in net income and total assets for 2021 (ignoring tax effects) Units of production depreciation Depreciation expense under units of production method is higher (True or False) Income and total assets in 2021 would have been (c) The transaction on June 30, 2021, shows the company purchased a patent for $54 000 from a third-party marketing company Suppose the company instead spent $54 000 to internally develop the new packaging technology, which it then patented Calculate the difference in net income and total assets for 2021 (ignoring tax effects) Additional expense for 2021 The income and total assets in 2021 would have been higher (True or False) Parts Unlimited Balance Sheet December 31, 2021 Liabilities Total Cuentos Total liabilities Noncurrentes Stockholders'equity Total stockholders' equity Totallaties and stockholders' equity USM ule places.) urmation from the requirements above, complete the 'Analysis'. (Round "fixed asset turnover ratio" answer to 2 decimal Analyze how well TNT Fireworks manages its assets: (a) Calculate the fixed asset turnover ratio for the year, using the total amount of property, plant, and equipment (net of accumulated deprecation) If the industry average fixed asset turnover is 0.75, is the company more or less efficient at generating sales with its foced assets than other companies in the same industry? (Hint: For the amount of fixed assets, use the net amount of all tangible long term assets) The fixed asset turnover ratio is The company is more efficient managing its inventory (True or False) (b) Suppose the equipment purchased on April 1, 2021, had been depreciated using the units of production method. At the time of purchase expected output was 20.000 units and actual production for 2021 was 3.000 units Calculate the amount of depreciation expense that would have been recorded and determine the difference in net income and total assets for 2021 (ignoring tax effects) Units of production depreciation Depreciation expense under units of production method is higher (True or False) Income and total assets in 2021 would have been (c) The transaction on June 30, 2021, shows the company purchased a patent for $54 000 from a third-party marketing company Suppose the company instead spent $54 000 to internally develop the new packaging technology, which it then patented Calculate the difference in net income and total assets for 2021 (ignoring tax effects) Additional expense for 2021 The income and total assets in 2021 would have been higher (True or False)