The unadjusted trial balance of Tamarisk, Inc., a private company following ASPE, at December 31, 2020, is as follows: | | | Debit | | Credit | | Cash | | $17,400 | | | | Accounts receivable | | 107,600 | | | | Allowance for doubtful accounts | | | | $3,340 | | Inventory | | 61,300 | | | | Prepaid insurance | | 4,672 | | | | Bond investment at amortized cost | | 45,600 | | | | Land | | 31,000 | | | | Buildings | | 151,400 | | | | Accumulated depreciationbuildings | | | | 12,200 | | Equipment | | 33,720 | | | | Accumulated depreciationequipment | | | | 4,496 | | Goodwill | | 16,550 | | | | Accounts payable | | | | 100,100 | | Bonds payable (20-year, 6%) | | | | 168,000 | | Common shares | | | | 116,600 | | Retained earnings | | | | 58,066 | | Sales revenue | | | | 192,500 | | Rent revenue | | | | 10,650 | | Rent expense | | 21,750 | | | | Supplies expense | | 10,300 | | | | Purchases | | 97,900 | | | | Purchase discounts | | | | 840 | | Salaries and wages expense | | 54,800 | | | | Interest expense | | 12,800 | | | | | | $666,792 | | $666,792 | Additional information: | 1. | | Actual rent costs amounted to $1,450 per month. The company has already paid for rent for the first quarter of 2021. | | 2. | | The building was purchased and occupied on January 1, 2018, with an estimated useful life of 20 years, and residual value of $29,400. (The company uses straight-line depreciation.) | | 3. | | Prepaid insurance contains the premium costs of several policies, including Policy A, cost of $2,620, one-year term, taken out on April 1, 2020; and Policy B, cost of $2,052, three-year term, taken out on September 1, 2020. | | 4. | | A portion of Tamarisks building has been converted into a snack bar that has been rented to the Martinez Corp. since July 1, 2019, at a rate of $7,100 per year payable each July 1 in advance. | | 5. | | One of the companys customers declared bankruptcy on December 30, 2020. It is now certain that the $2,600 the customer owes will never be collected. This fact has not been recorded. In addition, Tamarisk estimates that 5% of the Accounts Receivable balance on December 31, 2020, will become uncollectible. | | 6. | | An advance of $650 to a salesperson on December 31, 2020, was charged to Salaries and Wages Expense. | | 7. | | On November 1, 2018, Tamarisk issued 168 $1,000 bonds at par value. Interest is paid semi-annually on April 30 and October 31. | | 8. | | The equipment was purchased on January 1, 2018, with an estimated useful life of 15 years, and no residual value. (The company uses straight-line depreciation.) | | 9. | | On August 1, 2020, Tamarisk purchased at par value 40 $1,140, 8% bonds maturing on July 31, 2022. Interest is paid on July 31 and January 31. | | 10. | | The inventory on hand at December 31, 2020, was $88,000 after a physical inventory count. (Use "Inventory" account for closing out the beginning inventory amount and recording the ending inventory amount.) | | | | |
