Wally's Widget Company (WWC) incorporated near the end of 2011. Operations began in January of 2012. WWC prepares adjusting entries and financial statements at the end of each month. Balances in the accounts at the end of January are as follows:

PLEASE HELP WITH 1-c.

Prepare the financial statements at the end of February. (Income Statement, Statement of Retained earnings & balance sheet)

Project 2: Review of Merchandising Cycle The following information applies to the questions displayed below) Wally's Widget Company (WC) incorporated near the end of 2011. Operations began in January of 2012 wwc prepares adjusting entries and financial statements at the end of each month Balances in the accounts at the end of January are as follows: Cash Accounts Receivable Allowance for Doubtful Accounts Inventory (35 units) $ 21,620 Untamed Revenue (30 units) $ 12,650 Accounts Payable Len Rent) $ (1900) Notes Payable $ 2.800 Contributed Capital Retained Earnings - Feb 1 2012 $ 5,350 $ 3.300 $16.000 $ 7000 S 3520 WWC establishes e policy that it will sell inventory at $180 per unit In January, WwC received a $5.350 advance for 30 units, as reflected in Unearned Revenue. WWC's February 1 inventory balance consisted of 35 units at a total cost of $2.800. WWC's note payable accrues interest at a 12% annual rate. wwe will use the FIFO inventory method and record COGS on a perpetual basis. February Transactions 02/01 Included in WWC's February 1 Accounts Receivable balance is a $1.400 account due from Kit Kote WWC customer. Kit Kat is having cash flow problems and cannot pay its balance at this time wWC arranges with Kit Kat to convert the $1,400 balance to a note, and KitKat signs a 5-month note at 12% annual interest. The principal and all interest will be due and payable to WWC on August 2012 02/02 wwc peld a S650 insurance premium covering the month of February The amount paid is recorded directly as an expense 02:05 An additional 180 units of inventory are purchased on account by WwC for $13.500- terms 215 n30 02/05 WWC paid Federal Express 5360 to have the 180 units of inventory delivered overnight Delivery occurred on 02/06 02/10 Sales of 150 units of inventory occurred during the period of 02/07 - 02/10. The sales terms are 2/10, net 30 02/15 The 30 units that were paid for in advance and recorded in January are delivered to the customer 02/15 25 units of the inventory that had been sold on 2/10 ore returned to WWC. The units are not damaged and can be resold. Therefore, they are returned to inventory. Assume the units retumed 02/16 ww pays the first 2 weeks wages to the employees. The total paid is $2.800 02/17 Paid in full the amount owed for the 2/05 purchase of inventory WwC records purchase discounts in the current period rather than as a reduction of inventory costs. 02/18 Wrote off a customer's account in the amount of $2,000 02/19 $6.600 of rent for January and February was paid. Because all of the rene will soon expire, the February portion of the payment is charged directly to expense. 02/19 Collected $10,000 of customers Accounts Receivable. Of the $10,000, the discount was taken by customers on $8,000 of account balances therefore WWC received less than $10.000 02/26 WwC recovered $600 cash from the customer whose account hec previously been written off (see 02/18) 02/27 A $950 utility bill for February arrived. It is due on March 15 and will be paid then 02/28 wc declared and paid a $950 cash dividend Adjusting Entries 02/29 Record the $2,800 employee salary that is owed but will be paid March 1 02/29 wwC decides to use the aging method to estimate uncollectible accounts. WWc determines % of the ending balance is the appropriate end of February estimate of uncollectible accounts. 02/29 Record February interest expense accrued on the note payable. 02/29 Record one month's interest earned Kit Kat's note (see 02/09. rences 1.c. Prepare the financial statements at the end of February. (Balance Sheet only, items to be deducted must be indicated with a negative amount.) ww, Inc. Income Statement For the Month Ended February 29 Expenses Accounts Payable Add: Sales Returns and Allowances 0 $ 0 0 $ 0 WwC, Inc. Statement of Retained Earnings Retained Earings, Beginning of Period Retained Earnings, End of Period saved Saved www, Inc. Balance Sheet Assets Liabilities Current Assets Current Liabilities $ $ 0 Cash Accounts Receivable Notes Receivable 950 7.470 21.750 1,400 14 2,800 Interest Receivable 160 Unearned Revenue Accounts Payable Wages Payable Interest Payable Notes Payable Contributed Capital Retained Earnings Total Current Liabilities 16,000 Allowance for Doubtful Accounts Inventory (1.740) 6,930 7,000 8,914 35,824 Total Current Assets $ 35.824 $ Total liabilities 35,824 Stockholders' Equity Total Stockholders' Equity 0 Total Assets CIFICIO