Required information The following information applies to the questions displayed below Accounts Debit Credit Cash $ 26,600 Accounts Receivable 49,200 Allowance for Uncollectible Accounts $ 5,700 Inventory 21,500 Land 61,000 Equipment 22,500 Accumulated Depreciation 3,000 Accounts Payable 30,000 Notes Payable (6 , due April 1, 2022) 65,000 Common Stock 50,000 Retained Earnings 27,100 Totals $ 180,800 $ 180,800 During January 2021, the following transactions occur January 2 Sold gift cards totaling $11,000 The cards are redeemable for merchandise within one year of the purchase date January 6 Purchase additional inventory on account, $162,000 January 15 Firework sales for the first half of the month total $150,000 All of these sales are on account The cost of the units sold is $81,300 January 23 Receive $126,900 from customers on accounts receivable January 25 Pay $105,000 to inventory suppliers on accounts payable January 28 Write off accounts receivable as uncollectible, $6,300 January 30 Firework sales for the second half of the month total $158,000 Sales include $14,000 for cash and $144,000 on account The cost of the units sold is $87,000 January 31 Pay cash for monthly salaries, $53,500 Depreciation on the equipment for the month of January is calculated using the straight line method At the time the equipment was purchased, the company estimated residual value of $4,500 and a two year service life The company estimates future uncollectible accounts The company determines $26,000 of accounts receivable on January 31 are past due, and 30 of these accounts are estimated to be uncollectible The remaining accounts receivable on January 31 are not past due, and 4 of these accounts are estimated to be uncollectible (Hint Use the January 31 accounts receivable balance calculated in the general ledger ) Accrued interest expense on notes payable for January Accrued income taxes at the end of January are $14,500 By the end of January, $4,500 of the gift cards sold on January 2 have been redeemed 2 Record the adjusting entries on January 31 for the above transactions (If no entry is required for a particular transaction event, select No Journal Entry Required in the first account field ) View transaction list View journal entry worksheet Debit Credit No 1 Date January 31 General Journal Depreciation Expense Accumulated Depreciation January 31 Bad Debt Expense Allowance for Uncollectible Accounts 3 January 31 Interest Expense Interest Payable January 31 14,500 Income Tax Expense Income Tax Payable 14,500 5 January 31 4,500 Deferred Revenue Sales Revenue 4,500 3 Prepare an adjusted trial balance as of January 31, 2021 ACME Fireworks Adjusted Trial Balance January 31, 2021 Accounts Debit Credit Totals $ 0 $ 0

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 20, 2024

Required information [The following information applies to the questions displayed below.] Accounts Debit Credit Cash $ 26,600 Accounts Receivable 49,200 Allowance for Uncollectible Accounts $

Required information

[The following information applies to the questions displayed below.]

Accounts	Debit		Credit
Cash	$	26,600
Accounts Receivable		49,200
Allowance for Uncollectible Accounts			$	5,700
Inventory		21,500
Land		61,000
Equipment		22,500
Accumulated Depreciation				3,000
Accounts Payable				30,000
Notes Payable (6%, due April 1, 2022)				65,000
Common Stock				50,000
Retained Earnings				27,100
Totals	$	180,800	$	180,800

During January 2021, the following transactions occur:

January	2	Sold gift cards totaling $11,000. The cards are redeemable for merchandise within one year of the purchase date.
January	6	Purchase additional inventory on account, $162,000.
January	15	Firework sales for the first half of the month total $150,000. All of these sales are on account. The cost of the units sold is $81,300.
January	23	Receive $126,900 from customers on accounts receivable.
January	25	Pay $105,000 to inventory suppliers on accounts payable.
January	28	Write off accounts receivable as uncollectible, $6,300.
January	30	Firework sales for the second half of the month total $158,000. Sales include $14,000 for cash and $144,000 on account. The cost of the units sold is $87,000.
January	31	Pay cash for monthly salaries, $53,500.

Depreciation on the equipment for the month of January is calculated using the straight-line method. At the time the equipment was purchased, the company estimated residual value of $4,500 and a two-year service life.
The company estimates future uncollectible accounts. The company determines $26,000 of accounts receivable on January 31 are past due, and 30% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 4% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)
Accrued interest expense on notes payable for January.
Accrued income taxes at the end of January are $14,500.
By the end of January, $4,500 of the gift cards sold on January 2 have been redeemed.

image text in transcribed

2. Record the adjusting entries on January 31 for the above transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list View journal entry worksheet Debit Credit No 1 Date January 31 General Journal Depreciation Expense Accumulated Depreciation January 31 Bad Debt Expense Allowance for Uncollectible Accounts 3 January 31 Interest Expense Interest Payable January 31 14,500 Income Tax Expense Income Tax Payable 14,500 5 January 31 4,500 Deferred Revenue Sales Revenue 4,500 3. Prepare an adjusted trial balance as of January 31, 2021. ACME Fireworks Adjusted Trial Balance January 31, 2021 Accounts Debit Credit Totals $ 0 $ 0