Exercise 9-21 Complete the accounting cycle using long-term liability transactions (LO9-2, 9-8) (The following information applies to the questions displayed below.) On January 1, 2021, the general ledger of Freedom Fireworks includes the following account balances: Accounts Cash Accounts Receivable Inventory Land Buildings Allowance for Uncollectible Accounts Accumulated Depreciation Accounts Payable Conmon Stock Retained Earnings Debit $ 12, 200 36,000 153,000 77, 300 130,000 Credit $2,800 10, 600 28, 700 210,000 156, 400 $408, 500 Totals $408,500 During January 2021, the following transactions occur: Borrow $110,000 from Captive Credit Corporation. The installment note bears interest at 6x annually and matures in 5 years. Payments of $2,127 are required at the end of each month for 60 months. January January Receive $32,000 fron customers on accounts receivable. Pay cash on accounts payable, $21,000. January 10 January Pay cash for salaries, $29,900. 15 Firework sales for the month total $200, 600. Sales include $66,000 for cash and $134,600 on account. The cost of the units sold is $117, 500. Pay the first monthly instal Inent of $2,127 related to the $110,000 borrowed on January 1. Round your interest caiculation to the nearest dollar January 30 January 31
Exercise 9-21 Complete the accounting cycle using long-term liability transactions (LO9-2, 9-8) (The following information applies to the questions displayed below.) On January 1, 2021, the general ledger of Freedom Fireworks includes the following account balances: Accounts Cash Accounts Receivable Inventory Land Buildings Allowance for Uncollectible Accounts Accumulated Depreciation Accounts Payable Conmon Stock Retained Earnings Debit $ 12, 200 36,000 153,000 77, 300 130,000 Credit $2,800 10, 600 28, 700 210,000 156, 400 $408, 500 Totals $408,500 During January 2021, the following transactions occur: Borrow $110,000 from Captive Credit Corporation. The installment note bears interest at 6x annually and matures in 5 years. Payments of $2,127 are required at the end of each month for 60 months. January January Receive $32,000 fron customers on accounts receivable. Pay cash on accounts payable, $21,000. January 10 January Pay cash for salaries, $29,900. 15 Firework sales for the month total $200, 600. Sales include $66,000 for cash and $134,600 on account. The cost of the units sold is $117, 500. Pay the first monthly instal Inent of $2,127 related to the $110,000 borrowed on January 1. Round your interest caiculation to the nearest dollar January 30 January 31
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Exercise 9-21 Complete the accounting cycle using long-term liability transactions (LO9-2, 9-8)
[The following information applies to the questions displayed below.)
On January 1, 2021, the general ledger of Freedom Fireworks includes the following account balances:
Accounts
Cash
Accounts Receivable
Inventory
Land
Debit
Credit
$ 12,200
36,000
153,000
77, 300
130,000
Buildings
Allowance for Uncollectible Accounts
Accumulated Depreciation
Accounts Payable
Common Stock
$ 2,800
10,600
28,700
210,000
156,400
$408, 500
Retained Earnings
Totals
$408, 500
During January 2021, the following transactions occur:
Borrow $110,000 from Captive Credit Corporation. The installment note beaes interest at 6x annually and
matures in 5 years. Payments of $2,127 are required at the end of each month for 60 months.
Receive $32, 000 from customers on accounts receivable,
January
January
January
Pay cash on accounts payable, $21,000.
10
Pay cash for salaries, $29,900.
January
15
Firework sales for the month total $200,60o. Sales include $66,000 for cash and $134,600 on account. The cost
of the units sold is $117,500.
Pay the first monthly installnent of $2,127 related to the $110,000 borrowed on January 1. Round your
interest calculation to the nearest dollar
January
30
January
31
Transcribed Image Text:Exercise 9-21 Part 4
4. Prepare a multiple-step income statement for the period ended January 31, 2021.
Freedom Fireworks
Multiple-Step Income Statement
For the month ended January 31, 2021
Gross Profit
Expenses:
Total Operating Expenses
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