Required information Exercise 7-21B Complete the accounting cycle using long-term asset transactions (LO7-4, 7-7) [The following information applies to the questions displayed below.] On January 1, Year 1, the general ledger of a company includes the following account balances: Accounts Cash Debit $ 59,600 Credit Accounts Receivable 26,800 Allowance for Uncollectible Accounts $ 3,100 Inventory 37,200 Notes Receivable (5%, due in 2 years) 22,800 Land 164,000 Accounts Payable 15,700 Common Stock 229,000 Retained Earnings 62,600 Totals $310,400 $310,400 During January Year 1, the following transactions occur: January 1 Purchase equipment for $20,400. The company estimates a residual value of $2,400 and a four-year service life. January 4 Pay cash on accounts payable, $10,400. January 8 Purchase additional inventory on account, $91,900. January 15 Receive cash on accounts receivable, $22,900. January 19 Pay cash for salaries, $30,700. January 28 Pay cash for January utilities, $17,400. January 30 Sales for January total $229,000. All of these sales are on account. The cost of the units sold is $119,500. 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 $3,900 of accounts receivable on January 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 3% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts 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 $33,500. e. Accrued income taxes at the end of January are $9,900.