One Trick Pony (OTP) incorporated and began operations near the end of the year, resulting in the following post-closing balances at December 31:

Cash	$	15,920
Accounts Receivable		14,030
Allowance for Doubtful Accounts		850	*
Inventories		3,000
Deferred Revenue (40 units)		5,600
Accounts Payable		1,690
Note Payable (long-term)		12,000
Common Stock		8,700
Retained Earnings		4,110

* credit balance.

The following information is relevant to the first month of operations in the following year:

• OTP will sell inventory at $140 per unit. OTPs January 1 inventory balance consists of 50 units at a total cost of $3,000. OTPs policy is to use the FIFO method, recorded using a perpetual inventory system.
• In December, OTP received a $5,600 payment for 40 units OTP is to deliver in January; this obligation was recorded in Deferred Revenue. Rent of $1,470 was unpaid and recorded in Accounts Payable at December 31.
• OTPs note payable matures in three years, and accrues interest at a 10% annual rate.

January Transactions

1. Included in OTPs January 1 Accounts Receivable balance is a $1,200 balance due from Jeff Letrotski. Jeff is having cash flow problems and cannot pay the $1,200 balance at this time. On 01/01, OTP arranges with Jeff to convert the $1,200 balance to a six-month note, at 10% annual interest. Jeff signs the promissory note, which indicates the principal and all interest will be due and payable to OTP on July 1 of this year.
2. OTP paid a $370 insurance premium on 01/02, covering the month of January; the payment is recorded directly as an expense.
3. OTP purchased an additional 200 units of inventory from a supplier on account on 01/05 at a total cost of $10,000, with terms n/30.
4. OTP paid a courier $400 cash on 01/05 for same-day delivery of the 200 units of inventory.
5. The 40 units that OTPs customer paid for in advance in December are delivered to the customer on 01/06.
6. On 01/07, OTP received a purchase allowance of $1,500 on account, and then paid the amount necessary to settle the balance owed to the supplier for the 1/05 purchase of inventory (in c).
7. Sales of 60 units of inventory occurring during the period of 01/0701/10 are recorded on 01/10. The sales terms are n/30.
8. Collected payments on 01/14 from sales to customers recorded on 01/10.
9. OTP paid the first 2 weeks wages to the employees on 01/16. The total paid is $3,350.
10. Wrote off a $790 customers account balance on 01/18. OTP uses the allowance method, not the direct write-off method.
11. Paid $2,940 on 01/19 for December and January rent. See the earlier bullets regarding the December portion. The January portion will expire soon, so it is charged directly to expense.
12. OTP recovered $320 cash on 01/26 from the customer whose account had previously been written off on 01/18.
13. An unrecorded $320 utility bill for January arrived on 01/27. It is due on 02/15 and will be paid then.
14. Sales of 70 units of inventory during the period of 01/1001/28, with terms n/30, are recorded on 01/28.
15. Of the sales recorded on 01/28, 10 units are returned to OTP on 01/30. The inventory is not damaged and can be resold. OTP charges sales returns directly against Sales Revenue.
16. On 01/31, OTP records the $3,350 employee salary that is owed but will be paid February 1.
17. OTP uses the aging method to estimate and adjust for uncollectible accounts on 01/31. All of OTPs accounts receivable fall into a single aging category, for which 10% is estimated to be uncollectible. (Update the balances of both relevant accounts prior to determining the appropriate adjustment.)
18. Accrue interest for January on the note payable on 01/31.
19. Accrue interest for January on Jeff Letrotskis note on 01/31 (see a).

Requirement General Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Analysis General Journal tab - Prepare all January journal entries and adjusting entries for items (a)-(s). 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 Retained earnings - Prepare a statement of retained earning in the 'Statement of Retained earnings' Tab. 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. Requirement General Journal Requirement General Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Analysis Prepare all January journal entries and adjusting entries for items (a)-(s). Review the 'General Ledger' and the adjusted 'Trial Balance' Tabs to see the effect of the transactions on the account balances. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Date General Journal Debit Credit 1 Jan 01 1,200 Notes Receivable (short-term) Accounts Receivable 1,200 2 Jan 02 370 Insurance Expense Cash 370 3 Jan 05 10,000 Inventory Accounts Payable 10,000 4 Jan 05 400 Inventory Cash 400 5 Jan 06 5,800 x Deferred Revenue Sales Revenue 5,800 6 Jan 06 Cost of Goods Sold 3,280 x Inventory 3,280 x 7 Jan 07 Accounts Payable 1,500 7 Jan 07 1,500 > Accounts Payable Inventory 1,500 8 Jan 07 8,500 Accounts Payable Cash 8,500 9 Jan 10 Accounts Receivable 8,400 Sales Revenue 8,400 10 Jan 10 Cost of Goods Sold 2,800 x Inventory 2,800 X 11 Jan 14 Cash 8,400 OOI Accounts Receivable 8,400 12 Jan 16 3,350 Salaries and Wages Expense Cash 3,350 13 Jan 18 790 Allowance for Doubtful Accounts Accounts Receivable 790 14 Jan 19 Accounts Payable Rent Expense Cash 1,470 1,470 ol 2,940 15 Jan 26 320 Accounts Receivable Allowance for Doubtful Accounts 320 16 Jan 26 Cash 320 Accounts Receivable 320 17 Jan 27 320 Utilities Expense Accounts Payable 320 18 Jan 28 Accounts Receivable 9,800 Sales Revenue 9,800 19 Jan 28 4,200 X Cost of Goods Sold Inventory 4,200 20 Jan 30 X 1,400 Inventory Accounts Receivable 1,400 21 Jan 30 360 X Inventory Cost of Goods Sold 360 X 22 Jan 31 3,350 Salaries and Wages Expense Salaries and Wages Payable 3,350 23 Jan 31 1,700 Bad Debt Expense Allowance for Doubtful Accounts 1,700 24 Jan 31 100 Interest Expense Interest Payable 100 25 Jan 31 Interest Receivable 10 Interest Revenue 10 Requirement General Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Analysis Choose the appropriate accounts to be reported on the income statement. Select the 'adjusted' from the dropdown, which will then populate the balances in those accounts from the trial balance. However, you will need to calculate and enter the amount of the net income or loss for the period. Adjusted ONE TRICK PONY Income Statement For the Month Ended January 31 $ $ Ooo $ 0 0 0 0 0 0 0 Income from Operations Interest Revenue (Expense), net 90 $ (90) X Answer is not complete. Requirement General Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Analysis Prepare the statement of retained earnings at the end of January 31. You will need to determine and enter the accounts and balances to prepare the Statement of Retained Earnings. Adjusted ONE TRICK PONY Statement of Retained Earnings For the Month Ended January 31 Balance, January 1 4,110 Balance, December 1 $ 4,110 Requirement General Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Analysis Use the dropdowns to select the accounts properly included on the classified balance sheet. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. You will need to determine and enter the balance of the Common Stock and Retained Earnings accounts in the Stockholders' Equity section. Adjusted ONE TRICK PONY Balance Sheet At December 31 $ 0 0 0 0 0 0 0 0 0 0 0 0 Requirement General Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Analysis For the month ended January 31, indicate the (i) gross profit percentage, (ii) number of units in ending inventory, and (iii) cost per unit of ending inventory. (Round percentage answer to 1 decimal place.) % Gross profit percentage Number of units in ending inventory Cost per unit of ending inventory Units per Unit If OTP had used the percentage of sales method (using 2% of Net Sales) rather than the aging method, what amounts would OTC's January financial statements have reported for (i) Bad Debt Expense and (ii) Accounts Receivable, net? Bad Debt Expense Accounts Receivable, net If OTP had used LIFO rather than FIFO, what amount would OTC have reported for Cost of Goods Sold on 01/10? Cost of Goods Sold