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Clean Up, Inc. sells a multi-use cleaning tool. The trial balance as of January 1, 2016 is shown below: Clean Up, Inc. Trial Balance January 1, 2016 Account Cash Accounts receivable Allowance for doubtful accounts Inventory Prepaid Rent Equipment Accumulated depreciation Accounts payable Sales tax payable FICA tax payable Withheld income tax payable Unemployment tax payable Salaries payable Unearned revenue Interest payable Income tax payable Dividend payable Notes payable - long-term Common stock Additional paid-in capital Retained earnings Treasury stock Sales Cost of goods sold Salaries expense Payroll tax expense Rent expense Bad debt expense Depreciation expense Interest expense Income tax expense 12,000 31,500 1,863 20,550 1,200 16,000 1,500 586 306 300 180 1,000 2,250 160 16,000 5,000 15,000 39,105 2,000 - Note: although all accounts are shown with a positive balance, they have the normal debit or credit balance that accounts in t The following information pertains to the trial balance amounts at December 31, 2015: Accounts receivable are billed with terms of net 30 days. The Accounts Receivable Aging at December 31. 2015 is shown below Allowance for doubtful accounts is estimated based on the aging of accounts receivable method. The estimated bad debt loss Not yet due = 2% Up to 90 days past due = 7% Over 90 days past due = 20% Inventory is recorded using the last-in, first-out method and is computed based on a perpetual basis. The inventory report as o - Prepaid rent represents rent paid in December 2015 for January - February 2016. - Equipment was purchased on July 1, 2015. Residual value is estimated at $1,000. Useful life is estimated at 5 years. The c - Inventory is sold for $45 per unit, plus sales tax of 6%. The sales tax are remited to the taxing authority on the 10 th day o - Employee wages are $2,000 per month and are paid semi-monthly. Payments are issued on the 16 th of the month for the o Withholding for income taxes = $150 per pay and are remited to the taxing authority on the 15 th day of the following mont o FICA Payable is comprised of Social Security taxes of 6.2% and Medicare taxes of 1.45% for employee withholdings with mat o Unemployment taxes = $30 per pay. This is an employer tax only. These amounts are remited to the taxing authority on the - Unearned revenue represents a customer payment for 50 units. The order will be filled and shipped in January 2016. The - Note Payable is from a two-year, 4% bank loan signed on July 1, 2015. - The par value of common stock is $10 per share. - Treasury stock is from the purchase of 100 shares of common stock at $20 per share. During January 2016, Clean Up, Inc. experienced the following transactions: (a) 1/1/2016 - Paid employees for the second half of December 2015 (amounts were previously accrued). (b) 1/2/2016 - A computer is purchased for $1,800. The estimated useful life is 3 years and it is estimated to have no resid (c) 1/3/2016 - A cash dividend of $1.00 per share is declared. The dividend will be paid on February 10, 2016, (d) 1/4/2016 - Customer B has purchased 250 units of inventory on account. Terms are net 30 days. (e) 1/6/16 - Customer order is shipped and invoiced for the order paid for in December 2015. Related sales tax must be in (f) 1/9/16 - Customer C invoice dated 8/1/2015 is writen of as uncollectible. (g) 1/10/16 - Sales tax is remited for December 2015 sales. (h) 1/15/16 - Payroll withholding & FICA taxes for December 2015 are remited to the appropriate taxing authorities. (i) 1/16/16 - Paid employees for the first half of January 2016. All employee and employer payroll taxes are recorded. (j) 1/20/16 - Unemployment taxes are remited for the fourth quarter of 2015. (k) 1/25/16 - Customer A paid account in full. (l) 1/26/16 - Company purchased, on account, 100 units of inventory for $2,725. (m) 1/27/16 - Customer A has purchased 200 units. The sale is on credit and has terms of net 30 days. Adjusting journal entries: (n) Accrue salaries for the second half of January 2016. Include all employee withholding & employer payroll taxes. (o) Adjust the allowance for doubtful accounts based on previous estimated percentage collectible (include a schedule sho (p) Record January 2016 depreciation expense (include a schedule showing how you calculated depreciation). (q) Accrue interest on the note payable. (r) Adjust prepaid rent for rent expense incurred. (s) Record estimated corporate income taxes on January 2016 income. The corporate income tax rate is 15%. dit balance that accounts in their account type have (e.g. - assets have a debit balance, liabilities have a credit balance). mber 31. 2015 is shown below: The estimated bad debt loss rates are as follows: sis. The inventory report as of December 31, 2015 is shown below: s estimated at 5 years. The company utilizes straight-line depreciation for equipment. g authority on the 10 th day of the month following the sale. he 16 th of the month for the first half of the month and on the first day of the following month for the second half of the month. Informati th day of the following month. loyee withholdings with matching amounts for the employer portion of FICA taxes. The amounts are remited to the taxing authority of the o the taxing authority on the 20 th day of the month in January, April, July, and October for the preceding quarter. hipped in January 2016. The company did not remit the sales tax owed on the advance payment. ly accrued). s estimated to have no residual value. ruary 10, 2016, Related sales tax must be invoiced to Customer D. iate taxing authorities. roll taxes are recorded. mployer payroll taxes. tible (include a schedule showing how you calculated the bad debt expense amount). d depreciation). tax rate is 15%. credit balance). second half of the month. Information relating to payroll taxes includes: emited to the taxing authority of the 15 th day of the following month