Question

Required information

[The following information applies to the questions displayed below.]

On January 1, 2021, the general ledger of ACME Fireworks includes the following account balances:

Accounts	Debit				Credit
Cash	$	26,400
Accounts Receivable		48,800
Allowance for Uncollectible Accounts					$	5,500
Inventory		21,300
Land		59,000
Equipment		21,500
Accumulated Depreciation						2,800
Accounts Payable						29,800
Notes Payable (6%, due April 1, 2022)						63,000
Common Stock						48,000
Retained Earnings						27,900
Totals	$	177,000			$	177,000

During January 2021, the following transactions occur:

January		2		Sold gift cards totaling $10,600. The cards are redeemable for merchandise within one year of the purchase date.
January		6		Purchase additional inventory on account, $160,000.
January		15		Firework sales for the first half of the month total $148,000. All of these sales are on account. The cost of the units sold is $80,300.
January		23		Receive $126,700 from customers on accounts receivable.
January		25		Pay $103,000 to inventory suppliers on accounts payable.
January		28		Write off accounts receivable as uncollectible, $6,100.
January		30		Firework sales for the second half of the month total $156,000. Sales include $15,000 for cash and $141,000 on account. The cost of the units sold is $86,000.
January		31		Pay cash for monthly salaries, $53,300.

3. Prepare an adjusted trial balance as of January 31, 2021.
  

Answer 1

Solution:

Adjusted Trial Balance

	Debit ($)	Credit ($)
Cash ($26,400 + $10,600 + $126,700 - $103,000 + $15,000 - $53,300)	22,400
Accounts receivable ($48,800 + $148,000 - $126,700 - $6,100 + $141,,000)	205,000
Allowance for doubtful accounts for ($5,500 - $6,100)	600
Inventory ($21,300 + $160,000 - $80,300 - $86,000)	15,000
Land	59,000
Equipment	21,500
Accumulated depreciation		2,800
Accounts payable ( $29,800 + $160,000 - $103,000)		86,800
Notes payable		63,000
Deferred revenue		10,600
Common stock		48,000
Retained earnings		27,900
Sales revenue ( $148,000 + $156,000)		304,000
Cost of goods sold ($80,300 + $86,000)	166,300
Salaries expenses	53,300
Total	543,100	543,100

* If you have any query regarding this question please ask me.