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: Credit Debit $ 59,400 26,400 $ 2,900 Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Notes Receivable (5%, due in 2 years) Land Accounts Payable Common Stock Retained Earnings Totals 37,000 20,400 162,000 15,500 227,000 59,800 $305,200 $305,200 During January Year 1, the following transactions occur: January 1 Purchase equipment for $20,200. The company estimates a residual value of $2,200 and a six-year service life. January 4 Pay cash on accounts payable, $10,200. January 8 Purchase additional inventory on account, $89,900. January 15 Receive cash on accounts receivable, $22,700. January 19 Pay cash for salaries, $30,500. January 28 Pay cash for January utilities, $17,200. January 30 Sales for January total $227,000. All of these sales are on account. The cost of the units sold is $118,500. 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 $3,700 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 2% 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 $33,300. e. Accrued income taxes at the end of January are $9,700. Exercise 7-21B Part 3 3. Prepare an adjusted trial balance as of January 31, Year 1. Credit Adjusted Trial Balance January 31, Year 1 Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Note Receivable Debit $ 4,000 230,700 $ 6,390 8,400 20,400 162,000 Land 95,200 227,000 59,800 3,490 63,800 17,200 250 Accounts Payable Common Stock Retained Earnings Bad Debt Expense Salaries Expense Utilities Expense Depreciation Expense Interest Revenue Income Tax Expense Income Tax Payable Accumulated Depreciation Salaries Payable Equipment Cost of Goods Sold 85 9,700 9,700 250 33,300 20,200 118,500 Totals S 540, 140 $ 550,225 Red text indicates no response was expected in a cell or a formula-based calculation is incorrect: no points deducted