Required information [The following information applies to the questions displayed below.) One Product Corporation (OPC) incorporated at the beginning of last year. The balances on its post-closing trial balance prepared on December 31, at the end of its first year of operations, were: Cash 20,150 Accounts Receivable 8,220 Allowance for Doubtful Accounts 925 Inventory 12,060 Prepaid Rent 1,680 Equipment 29,800 Accumulated Depreciation 2,880 Accounts Payable 0 Sales Tax Payable 500 FICA Payable 600 Withheld Income Taxes Payable 500 Salaries and Wages Payable 1,600 Unemployment Tax Payable 300 Deferred Revenue 4,500 Interest Payable 504 Notes Payable (long-term) 22,400 Common Stock 14,300 Additional Paid-In Capital, Common 19,401 Retained Earnings 7,500 Treasury Stock The following information is relevant to the first month of operations in the following year; 4,000 . OPC sells its inventory at $150 per unit, plus sales tax of 6 percent. OPC's January 1 inventory balance consists of 180 units at a total cost of $12,060. OPC's policy is to use the FIFO method, recorded using a perpetual inventory system. The $1,680 in Prepaid Rent relates to a payment made in December for January rent this year. The equipment was purchased on July 1 of last year. It has a residual value of $1,000 and an expected life of five years. It is being depreciated using the straight-line method. Employee wages are $4,000 per month. Employees are paid on the 16th for the first half of the month and on the first day of the following month for the second half of each month. Withholdings each pay period include $250 of Income taxes and $150 of FICA taxes. These withholdings and the employer's matching contribution are paid The following information is relevant to the first month of operations in the following year. . OPC sells its inventory at $150 per unit, plus sales tax of 6 percent. OPC's January 1 inventory balance consists of 180 units at a total cost of $12,060. OPC's policy is to use the FIFO method, recorded using a perpetual inventory system The $1,680 in Prepaid Rent relates to a payment made in December for January rent this year, The equipment was purchased on July 1 of last year. It has a residual value of $1,000 and an expected life of five years. It is being depreciated using the straight-line method. Employee wages are $4,000 per month. Employees are paid on the 16th for the first half of the month and on the first day of the following month for the second half of each month. Withholdings each pay period include $250 of income taxes and $150 of FICA taxes. These withholdings and the employer's matching contribution are paid monthly on the second day of the following month. In addition, unemployment taxes of $50 are accrued each pay period, and will be paid on March 31. Deferred Revenue is for 30 units ordered and paid for in advance by two customers in late December. One order of 25 units is to be filled in January, and the other will be filled in February Notes Payable arises from a three-year, 9 percent bank loan received on October 1 last year. The par value on the common stock is $2 per share. Treasury Stock arises from the reacquisition of 500 shares at a cost of $8 per share. January Transactions a. On 1/01, OPC paid employees' salaries and wages that were previously accrued on December 31. b. A truck is purchased on 102 for $9,500 cash. It is estimated this vehicle will be used for 50,000 miles, after which it will have no residual value. c. Payroll withholdings and employer contributions for December are remitted on 103. d. OPC declares a $0.50 cash dividend on each share of common stock on 104, to be paid on 1/10: e. A $970 customer account is written off as uncollectible on 1/05. 1 On 1/06, recorded sales of 175 units of inventory on account. Sales tax is charged but not yet collected or remitted to 9. Sales taxes of $500 that had been collected and recorded in December are paid to the state on 107. h. On 1/08, OPC issued 300 shares of treasury stock for $2,400. Collections from customers on account, totaling $12,127, are recorded on 109. J. On 110, OPC distributes the $0.50 cash dividend declared on January 4. The company's stock price is currently $5 per share. K. OPC purchases on account and receives 70 units of inventory on 1/11 for $4,270. the state. e. A $970 customer account is written off as uncollectible on 105. 1. On 1/06, recorded sales of 175 units of inventory on account. Sales tax is charged but not yet collected or remitted to the state. 9. Sales taxes of $500 that had been collected and recorded in December are paid to the state on 107 h. On 1/08, OPC issued 300 shares of treasury stock for $2,400. 1. Collections from customers on account, totaling $12,127, are recorded on 109. On 1/10, OPC distributes the $0.50 cash dividend declared on January 4. The company's stock price is currently $5 per share. K OPC purchases on account and receives 70 units of inventory on V11 for $4,270. 1. The equipment purchased last year for $29,800 is sold on 1/15 for $28,600 cash. Record depreciation for the first half of January prior to recording the equipment disposal m. Payroll for January 1-15 is recorded and paid on 1/16. Be sure to accrue unemployment taxes and the employer's matching share of FICA taxes. n. Having sold the equipment, OPC pays off the note payable in full on 1/17. The amount paid is $22.996, which includes interest accrued in December and an additional $92 interest through January 17. o. On 1/27, OPC records sales of 30 units of inventory on account. Sales tax is charged but not yet collected or remitted. p. A portion of the advance order from December (25 units) is delivered on 1/29. No soles tax is collected on this transaction because the customer is a U.S. governmental organization that is exempt from sales tax. 9. To obtain funds for purchasing new equipment, OPC issued bonds on 1/30 with a total face value of $94,000, stated Interest rate of 5 percent, annual compounding, and six-year maturity date. OPC received $85,039 from the bond issuance, which implies a market interest rate of 7 percent. On 1/31, OPC records units-of-production depreciation on the vehicle (truck), which was driven 2,000 miles this month. S. OPC estimates that 2% of the ending accounts receivable balance will be uncollectible. Adjust the applicable accounts on 1/31, using the allowance method. 2. On 1/31, adjust for January rent expired. u. Accrue January 31 payroll on 131, which will be payable on February 1, Be sure to accrue unemployment taxes and the employer's matching share of FICA taxes, . Accrue OPC's corporate income taxes on 131, estimated to be $4,240. ther than distribute a cash dividend in January (see item)), OPC considered issuing a 30 percent stock dividend on common ack. What journal entry would OPC record had a 30 percent stock dividend been issued? mat journal entry would OPC record had a 10 percent stock dividend been issued? Required 8 Required 9 Rather than distribute a cash dividend in January (see item 1), OPC considered issuing a 30 percent stock dividend on common stock. What journal entry would OPC record had a 30 percent stock dividend been issued? (If no entry is required for a transaction/event, select "No Journal Entry Required in the first account field.) Transaction General Journal Credit Retained Earnings 10,725 Common Stock 4,290 Additional Paid-In Capital, Common Stock 6,435 No Debit 1 Required Required 9 > Required 8 Required 9 What journal entry would OPC record had a 10 percent stock dividend been issued? (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) No Credit Transaction 1 Debit 3,575 1 General Journal Retained Earnings Common Stock Additional Paid-in Capital, Common Stock 1,430 2,145 X