One Product Corp. (OPC) incorporated at the beginning of last year. The balances on its post-closing trial balance prepared on December 31, at the end of its first year of operations, were: $19,710 8,320 1,025 14,020 1,880 41,800 4,080 Cash Accounts Receivable Allowance for Doubtful Accounts Inventory Prepaid Rent Equipment Accumulated Depreciation Accounts Payable Sales Tax Payable FICA Payable Withheld Income Taxes Payable Salaries and Wages Payable Unemployment Tax Payable Deferred Revenue Interest Payable Note Payable (long-term) Common Stock Additional Paid-In Capital, Common Retained Earnings Treasury Stock 500 600 500 1,600 300 4,500 527 23,400 17,300 19,878 15,520 4,000 The following information is relevant to the first month of operations in the following year: OPC sells its inventory at $150 per unit, plus sales tax of 6%. OPC's January 1 inventory balance consists of 180 units at a total cost of $14,020. OPC's policy is to use the FIFO method, recorded using a perpetual inventory system. The $1,880 in Prepaid Rent relates to a payment made in December for January rent this year. The equipment was purchased on July 1 of last year. It has a residual value of $1,000 and an expected life of five years. It is being depreciated using the straight-line method. Employee wages are $4,000 per month. Employees are paid on the 16th for the first half of the month and on the first day of the following month for the second half of each month. Withholdings each pay period include $250 of income taxes and $150 of FICA taxes. These withholdings and the employer's matching contribution are paid monthly on the second day of the following month. In addition, unemployment taxes of $50 are accrued each pay period, and will be paid on March 31. Deferred Revenue is for 30 units ordered and paid for in advance by two customers in late December. One order of 25 units is to be filled in January, and the other will be filled in February. Notes Payable arises from a three-year, 9 percent bank loan received on October 1 last year. The par value on the common stock is $2 per share. Treasury Stock arises from the reacquisition of 500 shares at a cost of $8 per share. January Transactions a. On 1/01, OPC paid employees' salaries and wages that were previously accrued on December 31. b. A truck is purchased on 1/02 for $8,500 cash. It is estimated this vehicle will be used for 50,000 miles, after which it will have no residual value. c. Payroll withholdings and employer contributions for December are remitted on 1/03. d. OPC declares a $0.50 cash dividend on each share of common stock on 1/04, to be paid on 1/10. e. A $1,020 customer account is written off as uncollectible on 1/05. f. On 1/06, recorded sales of 175 units of inventory on account. Sales tax is charged but not yet collected or remitted to the state. g. Sales taxes of $500 that had been collected and recorded in December are paid to the state on 1/07. h. On 1/08, OPC issued 300 shares of treasury stock for $2,400. i. Collections from customers on account, totaling $17,871, are recorded on 1/09. j. On 1/10, OPC distributes the $0.50 cash dividend declared on January 4. The company's stock price is currently $5 per share. k. OPC purchases on account and receives 70 units of inventory on 1/11 for $4,200. 1. The equipment purchased last year for $41,800 is sold on 1/15 for $42,600 cash. Record depreciation for the first half of January prior to recording the equipment disposal. m. Payroll for January 1-15 is recorded and paid on 1/16. Be sure to accrue unemployment taxes and the employer's matching share of FICA taxes. n. Having sold the equipment, OPC pays off the note payable in full on 1/17. The amount paid is $24,023, which includes interest accrued in December and an additional $96 interest through January 17. o. On 127, OPC records sales of 30 units of inventory on account. Sales tax is charged but not yet collected or remitted. p. A portion of the advance order from December (25 units) is delivered on 1/29. No sales tax is collected on this transaction because the customer is a U.S. governmental organization that is exempt from sales tax. q. To obtain funds for purchasing new equipment, OPC issued bonds on 1/30 with a total face value of $104,000, stated interest rate of 5 percent, annual compounding, and six-year maturity date. OPC received $94,086 from the bond issuance, which implies a market interest rate of 7 percent. r. On 1/31, OPC records units-of-production depreciation on the vehicle (truck), which was driven 2,000 miles this month. S. OPC estimates that 2% of the ending accounts receivable balance will be uncollectible. Adjust the applicable accounts on 1/31, using the allowance method. t. On 1/31, adjust for January rent expired. u. Accrue January 31 payroll on 1/31, which will be payable on February 1. Be sure to accrue unemployment taxes and the employer's matching share of FICA taxes. V. Accrue OPC's corporate income taxes on 1/31, estimated to be $5,190. Requirement General Journal General Ledger Trial Balance Income Statement Statement of Stockholders Balance Sheet Equity Analysis General Journal tab - Prepare all January journal entries and adjusting entries for items (a)-(v). Review the 'General Ledger' and the adjusted 'Trial Balance' Tabs to see the effect of the transactions on the account balances. Trial Balance tab - Review the adjusted 'Trial Balance' as of January 31. Income Statement tab - Prepare an income statement for the period ended January 31 in the 'Income Statement' Tab. Statement of Stockholders' Equity tab - Prepare the statement of stockholders' equity for the month ended January 31. Balance Sheet tab - Prepare a classified balance sheet as of January 31 in the 'Balance Sheet' Tab. Analysis tab - Using the information from the requirements above, complete the 'Analysis' tab. Journal entry worksheet 2 3 4 5 6 7 8 ..... 26 > On 1/01, OPC paid employees' salaries and wages that were previously accrued on December 31. Record the transaction. Note: Enter debits before credits. General Journal Debit Credit Date Jan 01 Record entry Clear entry View general journal Unadjusted - General Ledger Account Cash Accounts Receivable Debit Credit No. Debit Credit No. Date Dec 30 Balance 19,710 Date Dec 30 Balance 8,320 Inventory No. Allowance for Doubtful Accounts Date Debit Credit Dec 30 No. Debit Credit Balance Balance 1,025 Date Dec 30 14,020 Prepaid Rent Equipment No. Debit Credit No. Credit Date Dec 30 Balance 1,880 Date Dec 30 Balance 41,800 Accumulated Depreciation-Equipment Date Debit Credit Dec 30 Interest Payable Debit Credit No. No. Balance Balance 4,080 Date Dec 30 527 No. Salaries and Wages Payable Date Debit Credit Dec 30 No. Withheld Income Taxes Payable Date Debit Credit Dec 30 Balance 1,600 Balance 500 FICA Payable Debit Unemployment Tax Payable Debit Credit No. Credit No. Date Dec 30 Balance 600 Date Dec 30 Balance 300 Sales Tax Payable Debit Credit Deferred Revenue Debit Credit No. / No. Date Dec 30 Balance 500 Date Dec 31 Balance 4,500 Notes Payable (long-term) Common Stock Unadjusted - ONE PRODUCT CORP. Trial Balance January 30, 2020 Credit $ Debit 19,710 8,320 025 14,020 1,880 41,800 Account Title Cash Accounts Receivable Allowance for Doubtful Accounts Inventory Prepaid Rent Equipment Accumulated Depreciation-Equipment Interest Payable Salaries and Wages Payable Withheld Income Taxes Payable FICA Payable Unemployment Tax Payable Sales Tax Payable Deferred Revenue Notes Payable (long-term) Common Stock Additional Paid-In Capital, Common Stock Retained Earnings Treasury Stock Total 4,080 527 1,600 500 600 300 500 4,500 23,400 17,300 19,878 15,520 4,000 89,730 $ 89,730 Unadjusted ONE PRODUCT CORP. Income Statement For the Month Ended January 31 Loss(Gain) on Disposal Income from Operations Income before Income Tax Expense Unadjusted - ONE PRODUCT CORP. Statement of Stockholders' Equity For the Month Ended January 31 Additional Paid- Common Stock In Capital, Common Treasury Stock Retained Earinings $ 15,520 Beginning Stock Issuances Net Income Dividends Ending (4,075) 11,445 $ Required information At January 31 $ 11,445 11,445 11,445 What was OPC's total payroll cost for January? Total Payroll Cost Will the carrying value of the bond increase or decrease after recording interest in February? What is the interest payment OPC will need to pay annually on the bond? Interest Payment What was the gain or loss was recognized on the issuance of Treasury Stock on Jan. 8?