prepare a multi-step income statement for the period ended January 31,2021.
Check On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances: Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Notes Receivable (5, due in 2 years) Land Accounts Payable Common Stock Retained Earnings Totals Debit Credit $ 58,700 25,000 $ 2,200 36,300 12,000 155,000 14,800 220,000 50,000 $287,000 $287,000 During January 2021, the following transactions occur January 1 Purchase equipment for $19,500. The company estimates a residual value of $1,500 and a five-year service life. January 4 Pay cash on accounts payable, $9,500. January 8Purchase additional inventory on account, $82,900. January 15 Receive cash on accounts receivable, $22,000. January 19 Pay cash for salaries, $29,800. January 28 Pay cash for January utilities, $16,500. January 30 Firework sales for January total $220,000. All of these sales are on account The cost of the units sold is $115,000. Information for adjusting entries: a. Depreciation on the equipment for the month of January is calculated using the straight line method. b. The company estimates future uncollectible accounts. The company determines $3,000 of accounts receivable on Ja ary 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaining accounts receivable n January 31 are not past due, and 3% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 a ounts receivable balance calculated in the general ledger) c. Accrued interest revenue on notes receivable for January d. Unpaid salaries at the end of January are $32,600. e. Accrued income taxes at the end of January are $9,000 Check On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances: Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Notes Receivable (5, due in 2 years) Land Accounts Payable Common Stock Retained Earnings Totals Debit Credit $ 58,700 25,000 $ 2,200 36,300 12,000 155,000 14,800 220,000 50,000 $287,000 $287,000 During January 2021, the following transactions occur January 1 Purchase equipment for $19,500. The company estimates a residual value of $1,500 and a five-year service life. January 4 Pay cash on accounts payable, $9,500. January 8Purchase additional inventory on account, $82,900. January 15 Receive cash on accounts receivable, $22,000. January 19 Pay cash for salaries, $29,800. January 28 Pay cash for January utilities, $16,500. January 30 Firework sales for January total $220,000. All of these sales are on account The cost of the units sold is $115,000. Information for adjusting entries: a. Depreciation on the equipment for the month of January is calculated using the straight line method. b. The company estimates future uncollectible accounts. The company determines $3,000 of accounts receivable on Ja ary 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaining accounts receivable n January 31 are not past due, and 3% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 a ounts receivable balance calculated in the general ledger) c. Accrued interest revenue on notes receivable for January d. Unpaid salaries at the end of January are $32,600. e. Accrued income taxes at the end of January are $9,000
