On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances: Debit Accounts Cash Credit $ 59,000 Accounts Receivable 25,600 Allowance for Uncollectible Accounts $ 2,500 36,600 15,600 158,000 Inventory Notes Receivable (5%, due in 2 years) Land Accounts Payable 15,100 223,000 Common Stock Retained Earnings 54,200 $294,800 Totals $294,800 During January 2021, the following transactions occur: January 1 Purchase equipment for $19,800. The company estimates a residual value of $1,800 and a six-year service life. January 4 Pay cash on accounts payable, $9,800. January 8 Purchase additional inventory on account, $85,900. January 15 Receive cash on accounts receivable, $22,300. January 19 Pay cash for salaries, $30,100. January 28 Pay cash for January utilities, $16,800. January 30 Sales for January total $223,000. All of these sales are on account. The cost of the units sold is $116,500. Information for adjusting entries: a. Depreciation on the equipment for the month of January is calculated using the straight-line method. b. The company estimates future uncollectible accounts. The company determines $3,300 of accounts receivable on January 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaini accounts receivable on January 31 are not past due, and 2% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.) c. Accrued interest revenue on notes receivable for January. Unpaid salaries at the end of January are $32,900. e. Accrued income taxes at the end of January are $9,300.
On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances: Debit Accounts Cash Credit $ 59,000 Accounts Receivable 25,600 Allowance for Uncollectible Accounts $ 2,500 36,600 15,600 158,000 Inventory Notes Receivable (5%, due in 2 years) Land Accounts Payable 15,100 223,000 Common Stock Retained Earnings 54,200 $294,800 Totals $294,800 During January 2021, the following transactions occur: January 1 Purchase equipment for $19,800. The company estimates a residual value of $1,800 and a six-year service life. January 4 Pay cash on accounts payable, $9,800. January 8 Purchase additional inventory on account, $85,900. January 15 Receive cash on accounts receivable, $22,300. January 19 Pay cash for salaries, $30,100. January 28 Pay cash for January utilities, $16,800. January 30 Sales for January total $223,000. All of these sales are on account. The cost of the units sold is $116,500. Information for adjusting entries: a. Depreciation on the equipment for the month of January is calculated using the straight-line method. b. The company estimates future uncollectible accounts. The company determines $3,300 of accounts receivable on January 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaini accounts receivable on January 31 are not past due, and 2% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.) c. Accrued interest revenue on notes receivable for January. Unpaid salaries at the end of January are $32,900. e. Accrued income taxes at the end of January are $9,300.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:**General Ledger of TNT Fireworks as of January 1, 2021**
The general ledger includes the following account balances:
| Accounts | Debit | Credit |
|--------------------------------------|-----------|-----------|
| Cash | $59,000 | |
| Accounts Receivable | 25,600 | |
| Allowance for Uncollectible Accounts | | $2,500 |
| Inventory | 36,600 | |
| Notes Receivable (5%, due in 2 years)| 15,600 | |
| Land | 158,000 | |
| Accounts Payable | | 15,100 |
| Common Stock | | 223,000 |
| Retained Earnings | | 54,200 |
| **Totals** | $294,800 | $294,800 |
**Transactions in January 2021**
- **January 1**: Purchased equipment for $19,800, with a residual value of $1,800 and a six-year service life.
- **January 4**: Paid $9,800 cash on accounts payable.
- **January 8**: Purchased additional inventory for $85,900 on account.
- **January 15**: Received $22,300 cash on accounts receivable.
- **January 19**: Paid salaries of $30,100.
- **January 28**: Paid $16,800 cash for January utilities.
- **January 30**: Sales for January total $233,000, all on account. Cost of goods sold was $116,500.
**Adjusting Entries Information**
- **a. Depreciation**: Calculate using the straight-line method.
- **b. Uncollectible Accounts**: Estimate $3,300 as past due, with 50% uncollectible. Remaining accounts are 2% uncollectible (use the January 31 accounts receivable balance for calculations).
- **c. Interest Revenue**: Accrue on notes receivable for January.
- **d. Salaries**: Unpaid salaries at January end are $32,900.
- **e. Income Taxes**: Accrued income taxes at January end are $9,300.
Transcribed Image Text:### Journal Entry Worksheet
**Instruction:**
Record the closing entry for expenses.
**Note:** Enter debits before credits.
---
#### Table Description
- **Date:** January 31, 2021
- **General Journal:** A table with columns for date, general journal entries, debits, and credits. It consists of several blank rows to fill in the required information.
---
#### Action Buttons
- **Record Entry:** Button to save the journal entry.
- **Clear Entry:** Button to clear the journal entry fields.
- **View General Journal:** Button to view the entire general journal.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education