Question
On January 1, 2024, the general ledger of Freedom Fireworks includes the following account balances: Accounts Debit Credit Cash $ 11,700 Accounts Receivable 35,000 Allowance
On January 1, 2024, the general ledger of Freedom Fireworks includes the following account balances:
Accounts Debit Credit Cash $ 11,700
Accounts Receivable 35,000
Allowance for Uncollectible Accounts $ 2,300
Inventory 152,500 Land 72,300 Buildings 125,000 Accumulated Depreciation 10,100 Accounts Payable 23,200 Common Stock 205,000 Retained Earnings 155,900 Totals $ 396,500 $ 396,500 During January 2024, the following transactions occur: January 1 Borrow $105,000 from Captive Credit Corporation. The installment note bears interest at 6% annually and matures in 5 years. Payments of $2,030 are required at the end of each month for 60 months. January 4 Receive $31,500 from customers on accounts receivable. January 10 Pay cash on accounts payable, $16,000. January 15 Pay cash for salaries, $29,400. January 30 Firework sales for the month total $196,000. The cost of the units sold is $115,000. January 31 Pay the first monthly installment of $2,030 related to the $105,000 borrowed on January 1.
Prepare an adjusted trial balance as of January 31, 2024, after updating beginning balances (above) for transactions during January (requirement 1) and adjusting entries at the end of January (requirement 2).
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