On January 1, 2024, the general ledger of Big Blast Fireworks includes the following account balances: Accounts Debit Credit Cash $25,900 Accounts Receivable 46,500 Allowance for Uncollectible Accounts $4,300 Inventory 50,000 Land 91,600 Accounts Payable 25,200 Notes Payable (9%, due in 3 years) 50,000 Common Stock 76,000 Retained Earnings 58,500 Totals $214,000 $214,000 The $50,000 beginning balance of inventory consists of 500 units, each costing $100. During January 2024, Big Blast Fireworks had the following inventory transactions: January 3 Purchase 1,850 units for $209,050 on account ($113 each). January 8 Purchase 1,950 units for $230,100 on account ($118 each). January 12 Purchase 2,050 units for $252,150 on account ($123 each). January 15 Return 200 of the units purchased on January 12 because of defects. January 19 Sell 6,000 units on account for $900,000 The cost of the units sold is determined using a FIFO perpetual inventory system. January 22 Receive $881,000 from customers on accounts receivable. January 24 Pay $650,000 to inventory suppliers on accounts payable. January 27 Write off accounts receivable as uncollectible, $2,900. January 31 Pay cash for salaries during January, $139,000. The following information is available on January 31, 2024. At the end of January, the company estimates that the remaining units of inventory purchased on January 12 are expected to sell in February for only $100 each. [Hint: Determine the number of units remaining from January 12 after subtracting the units returned on January 15 and the units assumed sold (FIFO) on January 19.] The company records an adjusting entry for $3,830. for estimated future uncollectible accounts. The company accrues interest on notes payable for January. Interest is expected to be paid each December 31. The company accrues income taxes at the end of January of $14,300.

The $50,000 beginning balance of inventory consists of 500 units, each costing $100. During January 2024 , Big Blast Fireworks had the following inventory transactions: January 3 Purchase 1,850 units for $209,050 on account (\$113 each). January 8 Purchase 1,950 units for $230,100 on account (\$118 each). January 12 Purchase 2,050 units for $252,150 on account (\$123 each). January 15 Return 200 of the units purchased on January 12 because of defects. January 19 Sell 6,000 units on account for $900,000 The cost of the units sold is determined using a FIF0 perpetual inventory system. January 22 Receive $881,000 from customers on accounts receivable. January 24 Pay $650,000 to inventory suppliers on accounts payable. January 27 Write off accounts receivable as uncollectible, $2,900. January 31 Pay cash for salaries during January, $139,000. The following information is available on January 31, 2024. a. At the end of January, the company estimates that the remaining units of inventory purchased on January 12 are expected to sell in February for only $100 each. [Hint: Determine the number of units remaining from January 12 after subtracting the units returned on January 15 and the units assumed sold (FIFO) on January 19.] b. The company records an adjusting entry for $3,830. for estimated future uncollectible accounts. c. The company accrues interest on notes payable for January. Interest is expected to be paid each December 31. d. The company accrues income taxes at the end of January of $14,300. Record the entry to close the revenue accounts. Note: Enter debits before credits. Journal entry worksheet Record the entry to close the expense accounts. Note: Enter debits before credits. Adjusted \begin{tabular}{|c|c|r|} \hline \multicolumn{2}{|c|}{ BIG BLAST FIREWORKS } \\ \hline \multicolumn{2}{|c|}{ Multiple-Step Income Statement } \\ \hline \multicolumn{2}{|c|}{ For the Year Ended January 31, 2024 } \\ \hline & & \\ \hline Gross Profit & & \\ \hline & & \\ \hline & & \\ \hline Total Operating Expenses & & \\ \hline Operating Income & & 0 \\ \hline & & \\ \hline Income Before Taxes & & \\ \hline & & \\ \hline \end{tabular} Assessment Tool iFrame BIG BLAST FIREWORKS Classified Balance Sheet January 31, 2024