On January 1,2021 the general ledger of ACME Fireworks i cludes the following account balances:

[The following information applies to the questions displayed below.) On January 1, 2021, the general ledger of ACME Fireworks includes the following account balances: Credit Debit $ 25,500 47,000 $4,600 Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Land Equipment Accumulated Depreciation Accounts Payable Noten Payable (68, due April 1, 2022) Common Stock Retained Earnings Totale 20,400 50,000 17,000 1,900 28.900 54,000 39,000 31,500 $159,900 $159,900 During January 2021, the following transactions occur January 2 Sold gift cards totaling $8,800. The cards are redeemable for merchandise within one year of the purchase date. January 6 Purchase additional inventory on account, $151,000. January 15 Firework sales for the first half of the month total $139,000. All of these sales are an account. The cost of the units sold is $75,800. January 23 Receive $125,800 from customers on accounts receivable. January 25 Pay $94,000 to inventory suppliers on accounts payable. January 28 Write oft accounts receivable as uncollectible, 55,200. January 30 Firework sales for the second half of the month total $147,000. Sales include $12,000 for cash and $135,000 on account. The cost of the units sold 18 $81,500. January 31 Pay cash for monthly salaries, $52,400. View transaction list View journal entry workshoot No Dobit Credit Date January 31 1 General Journal Depreciation Expense Accumulated Depreciation 550 550 2 January 31 10,365 Bed Debt Expense Allowance for Uncollectible Accounts 10,345 7 3 January 31 270 Interest Expenso Interest Payable 270 4 January 31 13400 Income Tax Expense Income Tax Payable RADO 5 January 31 3400 Deferred Revenue Sales Revenue 3.400 Accounts Debit Credit Cash ~$ Accounts Receivable 25,000 X 47,000 X 4,600 X Allowance for Uncollectible Accounts Inventory Land 20,400 X 50,000 17,000 1,900 X 28,900 X 54,000 39,000 31,500 Equipment Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Interest Payable Income Tax Payable Deferred Revenue Depreciation Expense Bad Debt Expense Interest Expense Income Tax Expense 270 13,400 3,400 X 550 4,900 270 13,400 4. Prepare a multiple-step income statement for the period ended January 31, 2021. ACME FIREWORKS Income Statement For the year ended January 31, 2021 Sales Revenue Cost of Goods Sold $ 0 $ 52,400 Gross Profit Salaries Expense Depreciation Expense Bad Debt Expense 550 10,365 Total operating expenses Operating Income Interest Expense 63,315 (63,315) 270 (63,585) 13,400 (76,985) Income Tax Expense Net Income $ ACME FIREWORKS Classified Balance Sheet January 31, 2021 Assets Liabilities Less: Allowance for Uncollectible Accounts 0 Total Current Assets 0 Total Current Liabilities 0 0 Total Liabilities Stockholders' Equity Total Assets Total Stockholders' Equity Total Liabilities and Stockholders' Equity $ 0 $ 0 0 account. The cost of the units sold is $81,500. January 31 Pay cash for monthly salaries, $52,400. 6. Record closing entries. (If no entry is required for a transaction/event, select "No Journal Entry Require field.) View transaction list EX 1 Record the closing entry for revenue accounts. 2 Record the closing entry for expense accounts. Credit Note : Journal entry has been entered 7. Analyze the following for ACME Fireworks Requirement 1: a-1. Calculate the current ratio at the end of January Current Ratio Current Ratio Choose Numerator + Choose Denominator Current Ratio Il a-2. If the average current ratio for the industry is 1.80, is ACME Fireworks more or less liquid than the industry average? More liquid O Less liquid Requirement 2: b-1. Calculate the acid-test ratio at the end of January Acid-test Ratio Choose Denominator Choone Numerator Acid-test Ratio Acid-test Ratio b-2. If the average acid-test ratio for the industry is 1.50, Is ACME Fireworks more or less likely to have difficulty paying its currently maturing debts (compared to the industry average)? More likely Less likely Requirement 3: c-1. Assume the notes payable were due on April 1, 2021, rather than April 1, 2022. Calculate the revised current ratio at the end of January Current Ratio Choose Nurnerator Choose Denominator Current Ratio Current Ratio times + + Nand c-2. Indicate whether the revised ratio would increase, decrease, or remain unchanged. Decrease the current ratio Increase the current ratio Remain unchanged Nav