Question

On January 1, 2021, the general ledger of 3D Family Fireworks includes the following account balances:

Accounts	Debit				Credit
Cash	$	27,700
Accounts Receivable		15,500
Allowance for Uncollectible Accounts					$	4,600
Supplies		4,400
Notes Receivable (6%, due in 2 years)		23,000
Land		80,800
Accounts Payable						9,500
Common Stock						103,000
Retained Earnings						34,300
Totals	$	151,400			$	151,400

During January 2021, the following transactions occur:

January		2		Provide services to customers for cash, $54,100.
January		6		Provide services to customers on account, $91,400.
January		15		Write off accounts receivable as uncollectible, $4,300.
January		20		Pay cash for salaries, $33,300.
January		22		Receive cash on accounts receivable, $89,000.
January		25		Pay cash on accounts payable, $7,400.
January		30		Pay cash for utilities during January, $15,600.

The following information is available on January 31, 2021.

1. The company estimates future uncollectible accounts. The company determines $4,800 of accounts receivable on January 31 are past due, and 20% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)
2. Supplies at the end of January total $900.
3. Accrued interest revenue on notes receivable for January. Interest is expected to be received each December 31.
4. Unpaid salaries at the end of January are $35,400.

Please prepare an unadjusted, adjusted, and post-closing balance sheet.

Answer 1

Accounts receivables
	Dr		Cr
Beg Balance	15500	Allowance for uncollectibles	4300
Revenue	91400	Cash	89000
		Balance	13600
	106900		106900
Sales
	Dr		Cr
		Cash	54100
		Accounts receivables	91400
	0		145500
Allowance for uncollectible accounts
	Dr		Cr
Accounts receivables	4300	Beg balance	4600
End Balance	1700	Bad debts expense	1400
	6000		6000
Accounts payable
	Dr		Cr
Cash	7400	Beg balance	9500
Balance	2100
	9500		9500

Cash
Beg balance	27700	Salaries	33300
Sales	54100	accounts payable	7400
Accounts receivable	89000	Utilities	15600
		Balance	114500
	170800		170800

Supplies
	Dr		Cr
Beginning balance	4400	Supplies expense	3500
		Balance	900
	4400		4400

Interest on notes receivable
	=23000*0.06*1/12
	115
Salaries expense
Cash	33300
Unpaid	35400
	68700

	Amount	Provision for uncollectibles
Receivable Balance	13600
Past due receivables	4800	960	20%
Not past due receivables	8800	440	5%

	Trail balance, Jan1, 2021		Unadjusted trail balance 31 Jan. 2021		Adjustements		Adjusted trail balance
	Dr	Cr
Cash	27700		114500				114500
Accounts receivable	15500		13600				13600
Allowance for uncollectible accounts		4600		300		1400		1700
Supplies	4400		4400			3500	900
Notes receivable	23000		23000				23000
Land	80800		80800				80800
Accounts payable		9500		2100				2100
Common stock		103000		103000				103000
Retained earnings		34300		34300				34300
Revenue				145500				145500
Salaries			33300		35400		68700
Utilities			15600				15600
Bad debts expense					1400		1400
Interest income						115		115
Interest receivable					115		115
Supplies expense					3500		3500
Salaries payable						35400		35400
	151400	151400	285200	285200	40415	40415	322115	322115

Income statement
	Unadjusted	Adjustements	Adjusted
Revenue	145500		145500
Less : expenses
Salaries	33300	35400	68700
Utilities	15600		15600
Bad debts expense		1400	1400
Supplies expense		3500	3500
Add: other income
interest income	0	115	115
Net income	96600		56415

Retained earnings	Unadjusted	Adjustments	Post-closing
Beg balance	34300		34300
Net income	96600	40185	56415
End balance	130900		90715

Balancesheet
Assets	Unadjusted	Adjustments	Adjusted/Post-closing
Current Assets
Cash	114500		114500
Accounts receivable	13600		13600
Allowance for uncollectible accounts	-300	-1400	-1700
Supplies	4400	-3500	900
Interest receivable		115	115
Total current Assets	132200	-4785	127415
Non-current Assets
Notes receivable
Land	23000		23000
	80800		80800
Total non-current assets	103800		103800
Total Assets	236000		231215
Liabilities
Current liabilities
Accounts payable	2100		2100
Salaries payable	0	35400	35400
Total current liabilities	2100		37500
Shareholders' equity
Common stock	103000		103000
Retained earnings	130900	-40185	90715
Total equity	233900		193715
Total liabilities+equity	236000		231215