E7-21 The general ledger of TNT Fireworks, assignment help
E7-21 The general ledger of TNT Fireworks, assignment help
- E7–21 On January 1, 2018, the general ledger of TNT Fireworks includes the following account balances:
- During January 2018, the following transactions occur:
Accounts |
Debit |
Credit |
Cash |
$58,700 |
|
Accounts Receivable |
25,000 |
|
Allowance for Uncollectible Accounts |
$2,200 |
|
Inventory |
36,300 |
|
Notes Receivable (5%, due in 2 years) |
12,000 |
|
Land |
155,000 |
|
Accounts Payable |
14,800 |
|
Common Stock |
220,000 |
|
Retained Earnings |
________ |
50,000 |
Totals |
$287,000 |
$287,000 |
January 1 |
Purchase equipment for $19,500. The company estimates a residual value of $1,500 and a five-year service life. |
January 4 |
Pay cash on accounts payable, $9,500. |
January 8 |
Purchase additional inventory on account, $82,900. |
January 15 |
Receive cash on accounts receivable, $22,000 |
January 19 |
Pay cash for salaries, $29,800. |
January 28 |
Pay cash for January utilities, $16,500. |
January 30 |
Firework sales for January total $220,000. All of these sales are on account. The cost of the units sold is $115,000. |
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Required:
1. |
Record each of the transactions listed above. |
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2. |
Record adjusting entries on January 31.
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3. |
Prepare an adjusted trial balance as of January 31, 2018, after updating beginning balances (above) for transactions during January (Requirement 1) and adjusting entries at the end of January (Requirement 2). |
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4. |
Prepare a multiple-step income statement for the period ended January 31, 2018. |
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5. |
Prepare a classified balance sheet as of January 31, 2018. |
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6. |
Record closing entries. |
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7. |
Analyze how well TNT Fireworks manages its assets:
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