Question

I REALLY need someone to help me with Parts 2-7 of this problem. I am lost.

Required information On January 1, 2021, the general ledger of ACME Fireworks includes the following account balances: Credit Debit $ 25,100 46,200 $ 4,200 Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Land Equipment Accumulated Depreciation Accounts Payable Notes Payable (6%, due April 1, 2022 ) Common Stock Retained Earnings Totals 20,000 46,000 15,000 1,500 28,500 50,000 35,000 33,100 $152,300 $152,300 During January 2021, the following transactions occur: January 2 Sold gift cards totaling $8,000. The cards are redeemable for merchandise within one year of the purchase date. January 6 Purchase additional inventory on account, $147,000. January 15 Firework sales for the first half of the month total $135,000. All of these sales are on account. The cost of the units sold is $ 73,800. January 23 Receive $125,400 from customers on accounts receivable. January 25 Pay $90,000 to inventory suppliers on accounts payable. January 28 Write off accounts receivable as uncollectible, $4,800. January 30 Firework sales for the second half of the month total $143,000. Sales include $11,000 for cash and $132,000 on account. The cost of the units sold is $79,500. January 31 Pay cash for monthly salaries, $52,000.

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

6. Record closing entries for revenue and expense accounts. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

2.

Adjusted Trail Balance as on January 31,2021
Accounts	Debit	Credit
Cash	$ 27500	$ 0
Accounts Receivable	$ 183000	$ 0
Allowance for Uncollective Accounts		$ 11685
Inventory	$ 13700	$ 0
Land	$ 46000	$ 0
Equipment	$ 15000	$ 0
Accumulated Depreciation	$ 0	$ 2000
Depreciation	$ 500	$ 0
Accounts Payable	$ 0	$ 85500
Note Payable	$ 0	$ 50000
Common Stock	$ 0	$ 35000
Retained Earning	$ 0	$ 33100
Sales Revenue	$ 0	$ 281000
Deferred Revenue	$ 0	$ 5000
Cost of Goods Sold	$ 153300	$ 0
Salaries	$ 52000	$ 0
Interest on Note Payable	$ 250
Accrued Interest on Note Payable		$ 250
Bad Debt Expenses	$ 12285
Income Tax Expense	$ 13000
Accrued Income Tax Expenses		$ 13000
Total	$ 516535	$ 516535

Working Note : -

Journal Entry for Point no a to e

a. Depreciation A/c Dr 500

Accumulated Depreciation A/c Cr. 500

(($15000-$3000)/24 months )

b. Bad Debt Expenses A/c Dr. $12,285

Allowance for Uncollectible accounts A/c $12,285

(($11000 x 30%=$3300)+($183,000-$3300)x5%) =$12,285

c. Interest on Note Payable a/c Dr.

Accrued Interest on Note Payable A/c Cr.

($50000 x 6%x1/12) = $250.

d. Income Tax Expenses A/c Dr. $13000

Accrued Income tax expenses Cr . $13000

e. Deferred Revenue A/c Dr. $3000

Sales Revenue A/c Cr. $3000.

Now , we have entered the final balance in above adjusted trail balance.

2. Now we will prepare base on the above adjusted trail balance.

ACME Fireworks
Income Statement
for the year ended January 31,2021
Sales Revenue	$ 281000
Defferred Revenue	$ 5000
Total Revenue		$ 286000
Cost of Goods Sold		$ 153300
Gross Profit		$ 132700
Operating Expenses
Depreciation	$ 500
Salaries	$ 52000
Bad Debt Expenses	$ 12285
Interest on Note Payable	$ 250
Total Operating Expenses		$ 65035
Profit Before Income tax		$ 67665
Income Tax Expense		$ 13000
Net Profit		$ 54665

3.

ACME Fire Work
Balance Sheet
For the year ended January 31,201
Assets			Liabilities
Current Assets	$	$	Current Liabilities	$	$
Cash		27500	Accounts Payable		85500
Accounts Receivable	183000	0	Note Payable		50000
Less :-Allowance for Uncollective Accounts	11685	171315	Accured Interest on Note Payable		250
Inventory		13700	Accured Income Tax Expenses		13000
Total Current Assests		212515	Total Current Liabilities		148750
Non Current Assets			Other Liabilities
Land		46000	Deferred Revenue		5000
Equipment		15000	Accumulated Depreciation		2000
Total Non Current Assets		61000	Total Other Liabilities		7000
			Shareholder's equity
			Retained Earning	33100
			Add : Net Profit	49665	82765
			Common Stock		35000
			Total Shareholder's equity		117765
Total Assets		273515	Total Liabilities		273515

6.

Closing Entries
Profit and Loss A/c Dr	$ 281000
Sales Revenue Cr		$ 281000
(Closing Entry for Revenue)
Cost of Goods Sold A/c Dr.	$ 153300
Profit and Loss A/c Dr		$ 153300
(Closing Entry for Cost of Goods Sold)
Depreciation A/c Dr	$ 500
Salaries A/c Dr	$ 52000
Bad Debt Expenses A/c Dr	$ 12285
Interest on Note Payable A/c Dr	$ 250
Income Tax Expense A/c Dr	$ 13000
Profit and Loss A/c Dr		$ 78035
(Closing Entry for Operating Expenses)