On January 1, 2021, the general ledger of TNT Fireworks included the following account balances: Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Notes Receivable (5%, due in 2 years) Land Accounts Payable Common Stock Retained Earnings Totals Debit Credit $ 58,700 25,000 $ 2,200 36,300 12,000 155,000 14,800 220,000 50,000 $287,000 $287,000 During January 2021, the following transactions occurred: January 1 Purchased equipment for $19,500. The company estimates a residual value of $1,500 and a five-year service life. January 4 Paid cash on accounts payable, $9,500. January 8 Purchased additional inventory on account, $82,900. January 15 Received cash on accounts receivable, $22,000. January 19 Paid cash for salaries, $29,800. January 28 Paid cash for January utilities, $16,500. January 30 Firework sales for January totaled $220,000. All of these sales were on account. The cost of the units sold was $115,000. The following information is available on January 31, 2021 a. Depreciation on the equipment for the month of January is calculated using the straight-line method. b. At the end of January, $3,000 of accounts receivable are past due, and the company estimates that 50% of these accounts will not be collected. Of the remaining accounts receivable, the company estimates that 3% will not be collected. The note receivable of $12,000 is considered fully collectible and therefore is not included in the estimate of uncollectible accounts c. Accrued interest revenue on notes receivable for January d. Unpaid salaries at the end of January are $32,600. e. Accrued income taxes at the end of January are $9,000. selection. Adjusted TNT Fireworks Multiple-Step Income Statement For the year ended January 31, 2021 Sales revenue 220,000 Cost of goods sold (115,000) Gross profit Salaries expense 62.400 Utilities expense 16,500 Depreciation expense 300 Bad debt expense US 5.900 $ 105.000 85.100 Total operating expenses Operating income 19.900 888 Interest revenue 50 Income before taxes COOL 19.950 Income tax expense 9.000 Net income $ 10,950 apped Leden account, based on your selection. Adjusted TNT Fireworks Balance Sheet January 31, 2021 Assets Liabilities Current assets: Current liabilities Cash 88,200 Accounts receivable 5,400 223,000 (8,100) 4,200 Accounts payable Salaries payable Income tax payable Allowance for uncollectible accounts 32,600 9,000 Inventory Interest receivable 50 Total current liabilities 129,800 Total current assets 224 550 Total liabilities 129,800 Noncurrent assets. Stockholders' Equity Land Common stock 220,000 Retained earnings 60,950 Equipment Accumulated depreciation Notes receivable 155,000 19.500 (300) 12,000 0 0 0 Total assets Total stockholders equity Total liabilities & stockholders equity 280,950 $ 410,750 $ 410,750 Income Statement Analysis > requirements above, complete the 'Analysis'. (Round final answers to 1 decimal Analyze how well TNT Fireworks manages its assets: (a) Calculate the return on assets ratio for the month of January. If the average return on assets for the industry in January is 2%, is the company more or less profitable than other companies in the same industry? The return on assets ratio is: % The company is more profitable. (True or False) True (b) Calculate the profit margin for the month of January. If the industry average profit margin is 4%, is the company more on less efficient at converting sales to profit than other companies in the same industry? The profit margin is: % The company is more efficient at converting sales to profit. (True or False) True (c) Calculate the asset turnover ratio for the month of January. If the industry average asset turnover is 0.5 times per month, is the company more or less efficient at producing revenues with its assets than other companies in the same industry? The asset turnover ratio is: times The company is more efficient at producing revenues with its assets. (True or False) True ( Balance Sheet