Sandhill Co.'s balance sheet at December 31, 2021, is presented below. During January 2022, the following transactions occurred. Sandhill uses the perpetual inventory method. Jan. 1 Sandhill accepted a 4-month, 8\% note from Betheny Company in payment of Betheny's $1,200 account. 3 Sandhill wrote off as uncollectible the accounts of Walter Corporation (\$500) and Drake Company (\$200). 8 Sandhill purchased $15,490 of inventory on account. 11 Sandhill sold for $27,000 on account inventory that cost $16,580. 15 Sandhill sold inventory that cost $680 to Jack Rice for $1,100. Rice charged this amount on his Visa First Bank card. The service fee charged Sandhill by First Bank is 3%. 17 Sandhill collected $24,200 from customers on account. 21 Sandhill paid $15,420 on accounts payable. 24 Sandhill received payment in full (\$200) from Drake Company on the account written off on January 3. 27 Sandhill purchased advertising supplies for $1,280 cash. 31 Sandhill paid other operating expenses, $3,030. Adjustment data: 1. Interest is recorded for the month on the note from January 1. 2. Bad debts are expected to be 6% of the January 31,2022 , accounts receivable. 3. A count of advertising supplies on January 31,2022 , reveals that $550 remains unused. 4. The income tax rate is 30%. (Hint: Prepare the income statement up to Income before taxes and multiply by 30% to compute the amount; round to whole dollars.) (You may want to set up T-accounts to determine ending balances.) (a) Prepare journal entries for the transactions listed above and adjusting entries. (Include entries for cost of goods sold using the perpetual inventory system.) (Round answers to 0 decimal places, e.g. 1,250. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (To record sales revenues.) (To record cost of goods sold.) (To record sales revenues and service charges.) (To record cost of goods sold.) (1) (2) (3) (4) Sandhill Co.'s balance sheet at December 31, 2021, is presented below. During January 2022, the following transactions occurred. Sandhill uses the perpetual inventory method. Jan. 1 Sandhill accepted a 4-month, 8\% note from Betheny Company in payment of Betheny's $1,200 account. 3 Sandhill wrote off as uncollectible the accounts of Walter Corporation (\$500) and Drake Company (\$200). 8 Sandhill purchased $15,490 of inventory on account. 11 Sandhill sold for $27,000 on account inventory that cost $16,580. 15 Sandhill sold inventory that cost $680 to Jack Rice for $1,100. Rice charged this amount on his Visa First Bank card. The service fee charged Sandhill by First Bank is 3%. 17 Sandhill collected $24,200 from customers on account. 21 Sandhill paid $15,420 on accounts payable. 24 Sandhill received payment in full (\$200) from Drake Company on the account written off on January 3. 27 Sandhill purchased advertising supplies for $1,280 cash. 31 Sandhill paid other operating expenses, $3,030. Adjustment data: 1. Interest is recorded for the month on the note from January 1. 2. Bad debts are expected to be 6% of the January 31,2022 , accounts receivable. 3. A count of advertising supplies on January 31,2022 , reveals that $550 remains unused. 4. The income tax rate is 30%. (Hint: Prepare the income statement up to Income before taxes and multiply by 30% to compute the amount; round to whole dollars.) (You may want to set up T-accounts to determine ending balances.) (a) Prepare journal entries for the transactions listed above and adjusting entries. (Include entries for cost of goods sold using the perpetual inventory system.) (Round answers to 0 decimal places, e.g. 1,250. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (To record sales revenues.) (To record cost of goods sold.) (To record sales revenues and service charges.) (To record cost of goods sold.) (1) (2) (3) (4)
