Sunland Corporation's balance sheet at December 31, 2024, is presented below. Accounts receivable Allowance for doubtful accounts Inventory Jan. 1 1 2 8 3. During January 2025, the following transactions occurred. Sunland u 11 15 17 21 27 Adjustment data: Sunland Corporation Balance Sheet December 31, 2024 31 $13,010 20,600 (850) 9,760 $42.520 Accounts payable Common stock Retained earnings $8,310 18,500 15,710 $42.520 Sunland accepted a 4-month, 836 nota from Bethany Company in payment of Bethany's $1,200 account. Sunland wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300) Sunland purchased $15,700 of inventory on account. Sunland sold for $23,400 on account inventory that cost $16,110. Sunland sold inventory that cost $750 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Sunland by First Bankis 216 Sunland collected $24,700 from customers on account. Sunland paid $15,620 on accounts payable Sunland received payment in full ($300) from Drake Company on the account written off on January 3 Sunland purchased advertising supplies for $1,420 cash. Sunland paid other operating expenses, $3,390. You may want to set up T-accounts to determine ending balances) orpetual inventory system. Interest is recorded for the month on the note from January 1. Uncollectibles are expected to be 696 of the January 31, 2025, accounts receivable A count of advertising supplies on January 31, 2025, reveals that $530 remains unused. The income tax rate is 30%. (Hint Prepare the income statement up to Income Before Taxes and multiply by 30% to compute the amount, round to whole dollars.]
Sunland Corporation's balance sheet at December 31, 2024, is presented below. Accounts receivable Allowance for doubtful accounts Inventory Jan. 1 1 2 8 3. During January 2025, the following transactions occurred. Sunland u 11 15 17 21 27 Adjustment data: Sunland Corporation Balance Sheet December 31, 2024 31 $13,010 20,600 (850) 9,760 $42.520 Accounts payable Common stock Retained earnings $8,310 18,500 15,710 $42.520 Sunland accepted a 4-month, 836 nota from Bethany Company in payment of Bethany's $1,200 account. Sunland wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300) Sunland purchased $15,700 of inventory on account. Sunland sold for $23,400 on account inventory that cost $16,110. Sunland sold inventory that cost $750 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Sunland by First Bankis 216 Sunland collected $24,700 from customers on account. Sunland paid $15,620 on accounts payable Sunland received payment in full ($300) from Drake Company on the account written off on January 3 Sunland purchased advertising supplies for $1,420 cash. Sunland paid other operating expenses, $3,390. You may want to set up T-accounts to determine ending balances) orpetual inventory system. Interest is recorded for the month on the note from January 1. Uncollectibles are expected to be 696 of the January 31, 2025, accounts receivable A count of advertising supplies on January 31, 2025, reveals that $530 remains unused. The income tax rate is 30%. (Hint Prepare the income statement up to Income Before Taxes and multiply by 30% to compute the amount, round to whole dollars.]
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
Please be sure to provide detailed explanations and show work. The answers in RED are incorrect.
Instructions:
Prepare
Transcribed Image Text:Jan 31
Jan 31
Jan 31
V
Bad Debt Expens
Allowance for Doubtful Accounts
(To record bad debt expense)
Supplies Expense
Supple
(To record supplies used.)
Income Tax Expense
Income Taxes Payable
(To record income tax expense.)
00 10 00
00 00 00
757
890
835
Transcribed Image Text:Sunland Corporation's balance sheet at December 31, 2024, is presented below.
Cash
Accounts receivable
Allowance for doubtful accounts
Inventory
Jan. 1
3
1.
2.
3.
11
15
During January 2025, the following transactions occurred. Sunland uses the perpetual inventory system.
21
Sunland Corporation
Balance Sheet
December 31, 2024
282
Adjustment data:
27
$13,010
20,600
(850)
9,760
$42,520
Sunland accepted a 4-month, 8% note from Bethany Company in payment of Bethany's $1,200 account.
Sunland wrote off as uncollectible the accounts of Walter Corporation ($500) and Drake Company ($300).
Sunland purchased $15,700 of inventory on account.
Sunland sold for $23,400 on account inventory that cost $16,110.
Sunland sold inventory that cost $750 to Jack Rice for $900. Rice charged this amount on his Visa First Bank card. The service fee charged Sunland by First Bank is 396.
17 Sunland collected $24,700 from customers on account.
Sunland paid $15,620 on accounts payable.
24 Sunland received payment in full ($300) from Drake Company on the account written off on January 3.
Sunland purchased advertising supplies for $1,420 cash.
Accounts payable
Common stock
Retained earnings
31 Sunland paid other operating expenses, $3,390.
$8,310
18,500
15,710
[You may want to set up T-accounts to determine ending balances.)
$42,520
Interest is recorded for the month on the note from January 1.
Uncollectibles are expected to be 696 of the January 31, 2025, accounts receivable.
A count of advertising supplies on January 31, 2025, reveals that $530 remains unused.
The income tax rate is 30%. (Hint: Prepare the income statement up to Income Before Taxes and multiply by 30% to compute the amount, round to whole dollars.)
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