Prepare journal entries for the transactions listed above and adjusting entries.

Prepare and adjusted trial balance at January 31st, an income statement, and a classified balance sheet (listing assets in order of liquidity).

Comprehensive Accounting Cycle Review 8 Sunland Company's balance sheet at December 31, 2016, is presented below. Cash Accounts receivable Sunland Company Balance Sheet December 31, 2016 $13,270 Accounts payable 19,200 Common stock (750) Retained earnings 9,030 $40,750 $8,550 19,500 12,700 Allowance for doubtful accounts Inventory $40,750 During January 2016, the following transactions occurred. Sunland Company uses the perpetual inventory method. Jan. 1 3 8 11 15 17 21 24 27 31 Sunland Company accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $3,600 account. Sunland Company wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300). Sunland Company purchased $15,580 of inventory on account. Sunland Company sold for $26,200 on account inventory that cost $18,800. Sunland Company sold inventory that cost $700 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Sunland Company by First Bank is 3%. Sunland Company collected $20,800 from customers on account. Sunland Company paid $15,640 on accounts payable. Sunland Company received payment in full ($300) from Drake Company on the account written off on January 3. Sunland Company purchased advertising supplies for $1,270 cash. Sunland Company paid other operating expenses, $2,980. Adjustment data: 1. 2. Interest is recorded for the month on the note from January 1. Bad debts are expected to be 6% of the January 31, 2017, accounts receivable. A count of advertising supplies on January 31, 2017, reveals that $520 remains unused. The income tax rate is 30%. (Hint: Prepare the income statement up to "Income before taxes" and multiply by 30% to compute the amount; round to whole dollars.) 3. 4. Comprehensive Accounting Cycle Review 8 Sunland Company's balance sheet at December 31, 2016, is presented below. Cash Accounts receivable Sunland Company Balance Sheet December 31, 2016 $13,270 Accounts payable 19,200 Common stock (750) Retained earnings 9,030 $40,750 $8,550 19,500 12,700 Allowance for doubtful accounts Inventory $40,750 During January 2016, the following transactions occurred. Sunland Company uses the perpetual inventory method. Jan. 1 3 8 11 15 17 21 24 27 31 Sunland Company accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $3,600 account. Sunland Company wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300). Sunland Company purchased $15,580 of inventory on account. Sunland Company sold for $26,200 on account inventory that cost $18,800. Sunland Company sold inventory that cost $700 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Sunland Company by First Bank is 3%. Sunland Company collected $20,800 from customers on account. Sunland Company paid $15,640 on accounts payable. Sunland Company received payment in full ($300) from Drake Company on the account written off on January 3. Sunland Company purchased advertising supplies for $1,270 cash. Sunland Company paid other operating expenses, $2,980. Adjustment data: 1. 2. Interest is recorded for the month on the note from January 1. Bad debts are expected to be 6% of the January 31, 2017, accounts receivable. A count of advertising supplies on January 31, 2017, reveals that $520 remains unused. The income tax rate is 30%. (Hint: Prepare the income statement up to "Income before taxes" and multiply by 30% to compute the amount; round to whole dollars.) 3. 4