Sandhill Company's balance sheet at December 31, 2019, is presented below. WINTER COMPANY Balance Sheet December 31, 2019 Cash $15,000 Accounts payable Accounts receivable 19,400 Owner's capital Allowance for doubtful accounts (700) Inventory 9,200 $42,900 $8,750 34.150 $42,900 During January 2020, the following transactions occurred. Sandhill uses the perpetual inventory method. Jan. 1 3 8 11 15 Sandhill accepted a 4-month, 8% note from Merando Company in payment of Merando's $6,000 account. Sandhill wrote off as uncollectible the accounts of Inwood Corporation ($500) and Goza Company ($200). Sandhill purchased $20,000 of inventory on account Sandhill sold for $26,300 on account inventory that cost $17.500. Sandhill sold inventory that cost $800 to Mark Lauber for $1,400. Lauber charged this amount on his Visa First Bank card. The service fee charged Sandhill by First Bank is 3%. Sandhill collected $21.500 from customers on account. Sandhill paid $16,200 on accounts payable. Sandhill received payment in full ($200) from Goza Company on the account written off on January 3. Sandhill purchased supplies for $1,400 cash. Sandhill paid other operating expenses, $3,000. 17 21 24 27 31 Adjustment data: 1. 2. 3. Interest is recorded for the month on the note from January 1. Bad debts are expected to be 6% of the January 31, 2020, accounts receivable. A count of supplies on January 31, 2020, reveals that $600 remains unused. Date Account Titles and Explanation Debit > (To record sales revenues. To record cost of goods sold.) (To record sales revenues and service charges.) To record cost of foods sold.) (To reinstate the account previously written-off.) (To record the payment received) (To record other operating expense. (1) To record interest revenue. (2) To record bad debts expense) (3) To record supplies expense.) Account Titles and Explanation Debit Credit (To record sales revenues. To record cost of goods sold.) (To record sales revenues and service charges.) To record cost of goods sold.) To reinstate the account previously written-off. (To record the payment received) To record other operating expense. (1) (To record interest revenus. (2) (To record bad debts expense) (3) (To record supplies expense.)