[The following information applies to the questions displayed below] One Product Corporation (OPC) incorporated at the beginning of last year. The balances onits post-closing trial balance prepared on December 31, at the end of its first year of operations, were: $ 19,500 3,250 885 12,060 1,600 25,000 2,400 Cash Accounts Receivable Allowance for Doubtful Accounts Inventory Prepaid Rent Equipment Accumulated Depreciation Accounts Payable Sales Tax Payable FICA Payable withheld Income Taxes Payable Solaries and Wages Payable Unemployment Tax Payable Deferred Revenge Interest Payable Notes Payable (long-term Common Stock Additional Paid In Capital, Connon Retained Earnings Treasury Stock 500 800 500 1,600 300 4,500 495 22,000 13,300 19,210 4,120 4,000 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 $1,600 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. With holdings each pay period include $250 of income taxes and 5150 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 V January Transactions a. On 1101. OPC paid employees' salaries and wages that were previously accrued on December 31, b. A truck is purchased on 1/02 for $10,000 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 1103 d. Op declares a $0.50 cash dividend on each share of common stock on 104 to be paid on 1/10 e A $950 customer account is written off as uncollectible on 1705. 1 On 106 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 108. OPC issued 300 shares of treasury stock for $2.400. 1. Collections from customers on account, totaling $8,500 are recorded on 109. JOn 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 $4,410. 2 The equipment purchased last year for $25.000 is sold on 1/15 for $23,000 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 116. 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 $22,585, which include interest accrued in December and an additional $90 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 remitte p. A portion of the advance order from December (25 units) is delivered on 129. No sales tax is collected on this transaction because the customer is a US governmental organization that is exempt from sales tax. q. To obtain funds for purchasing new equipment, OPC issued bonds on 1/30 with a total face value of $90,000, statea interest rate of 5 percent, annual compounding, and six-year maturity date. OPC received $81.420 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 1900 miles this monti S. OPC estimates that 2% of the ending accounts receivable balance will be uncollectible Adjust the applicable accoue on 1/31, using the allowance method. t On 1/31, adjust for January rent expired. u Accrue January 31 payroll on 1/31, which will be payable on February 1. Be sure to accrue unemployment taxes and th employer's matching share of FICA taxes. V Accrue OPC's corporate income taxes on 131. estimated to be $3750 Income General General Statement of Requirement Journal Trial Balance Ledger Statement Stockholders Balance Sheet Analysis Equity General Journal tab - Prepare all January journal entries and adjusting entries for items (a)-(V). Review the 'General Ledger' and the adjusted Trial Balance Tabs to see the effect of the transactions on the account balances, Trial Balance tab - Review the adjusted 'Trial Balance as of January 31 Income Statement tab. Prepare an income statement for the period ended January 31 in the 'Income Statement Tab. Statement of Stockholders' Equity tab - Prepare the statement of stockholders' equity for the month ended January 31. Balance Sheet tab - Prepare a classified balance sheet as of January 31 in the 'Balance Sheet' Tab. Analysis tab - Using the information from the requirements above, complete the 'Analysis tab. unadjusted ONE PRODUCT CORPORATION Statement of Stockholders' Equity For the Month Ended January 31 Common Stock Additional Paid In Capital Common Retained Earinings Treasury Stock $ 4.120 Beginning Stock Issuances Net Income Dividendo Ending (3.075) 1.045 Balanc Requirement Journal Ledger Trial Balance Statement Stocknolders Equity Using the information from the requirements above, complete the 'Analysis' tab. What was OPC's total payroll cost for January? Total Payroll Cost Will the carrying value of the bond increase or decrease after recording interest in February? What is the interest payment OPC will need to pay annually on the bond? Interest Payment What was the gain or loss recognized on the issuance of Treasury Stock on January 82 Balance Sheel [The following information applies to the questions displayed below] One Product Corporation (OPC) incorporated at the beginning of last year. The balances onits post-closing trial balance prepared on December 31, at the end of its first year of operations, were: $ 19,500 3,250 885 12,060 1,600 25,000 2,400 Cash Accounts Receivable Allowance for Doubtful Accounts Inventory Prepaid Rent Equipment Accumulated Depreciation Accounts Payable Sales Tax Payable FICA Payable withheld Income Taxes Payable Solaries and Wages Payable Unemployment Tax Payable Deferred Revenge Interest Payable Notes Payable (long-term Common Stock Additional Paid In Capital, Connon Retained Earnings Treasury Stock 500 800 500 1,600 300 4,500 495 22,000 13,300 19,210 4,120 4,000 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 $1,600 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. With holdings each pay period include $250 of income taxes and 5150 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 V January Transactions a. On 1101. OPC paid employees' salaries and wages that were previously accrued on December 31, b. A truck is purchased on 1/02 for $10,000 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 1103 d. Op declares a $0.50 cash dividend on each share of common stock on 104 to be paid on 1/10 e A $950 customer account is written off as uncollectible on 1705. 1 On 106 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 108. OPC issued 300 shares of treasury stock for $2.400. 1. Collections from customers on account, totaling $8,500 are recorded on 109. JOn 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 $4,410. 2 The equipment purchased last year for $25.000 is sold on 1/15 for $23,000 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 116. 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 $22,585, which include interest accrued in December and an additional $90 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 remitte p. A portion of the advance order from December (25 units) is delivered on 129. No sales tax is collected on this transaction because the customer is a US governmental organization that is exempt from sales tax. q. To obtain funds for purchasing new equipment, OPC issued bonds on 1/30 with a total face value of $90,000, statea interest rate of 5 percent, annual compounding, and six-year maturity date. OPC received $81.420 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 1900 miles this monti S. OPC estimates that 2% of the ending accounts receivable balance will be uncollectible Adjust the applicable accoue on 1/31, using the allowance method. t On 1/31, adjust for January rent expired. u Accrue January 31 payroll on 1/31, which will be payable on February 1. Be sure to accrue unemployment taxes and th employer's matching share of FICA taxes. V Accrue OPC's corporate income taxes on 131. estimated to be $3750 Income General General Statement of Requirement Journal Trial Balance Ledger Statement Stockholders Balance Sheet Analysis Equity General Journal tab - Prepare all January journal entries and adjusting entries for items (a)-(V). Review the 'General Ledger' and the adjusted Trial Balance Tabs to see the effect of the transactions on the account balances, Trial Balance tab - Review the adjusted 'Trial Balance as of January 31 Income Statement tab. Prepare an income statement for the period ended January 31 in the 'Income Statement Tab. Statement of Stockholders' Equity tab - Prepare the statement of stockholders' equity for the month ended January 31. Balance Sheet tab - Prepare a classified balance sheet as of January 31 in the 'Balance Sheet' Tab. Analysis tab - Using the information from the requirements above, complete the 'Analysis tab. unadjusted ONE PRODUCT CORPORATION Statement of Stockholders' Equity For the Month Ended January 31 Common Stock Additional Paid In Capital Common Retained Earinings Treasury Stock $ 4.120 Beginning Stock Issuances Net Income Dividendo Ending (3.075) 1.045 Balanc Requirement Journal Ledger Trial Balance Statement Stocknolders Equity Using the information from the requirements above, complete the 'Analysis' tab. What was OPC's total payroll cost for January? Total Payroll Cost Will the carrying value of the bond increase or decrease after recording interest in February? What is the interest payment OPC will need to pay annually on the bond? Interest Payment What was the gain or loss recognized on the issuance of Treasury Stock on January 82 Balance Sheel
