Question

On January 1, 2021, the general ledger of Grand Finale Fireworks includes the following account balances: Accounts Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Accounts Payable Common Stock, $1 par value Additional Paid-in Capital Retained Earnings Totals Debit Credit $ 43,500 46,100 8,300 72,000 $ 9,800 15,400 18,000 88,000 38,700 $169,900 $169,900 During January 2021, the following transactions occur: January 2 Issue an additional 2,000 shares of $1 par value common stock for $40,000. January 9 Provide services to customers on account, $16,800. January 10 Purchase additional supplies on account, $5,700. January 12 Purchase 1,100 shares of treasury stock for $21 per share. January 15 Pay cash on accounts payable, $17,300. January 21 Provide services to customers for cash, $49,900. January 22 Receive cash on accounts receivable, $17,400. January 29 Declare a cash dividend of $0.30 per share to all shares outstanding on January 29. The dividend is payable on February 15. (Hint: Grand Finale Fireworks had 18,000 shares outstanding on January 1, 2021, and dividends are not paid on treasury stock.) January 30 Resell 900 shares of treasury stock for $23 per share. January 31 Pay cash for salaries during January, $42,800.

Please enter debits before credits!

Answer 1

Date	Account Title	Debit	Credit
2-Jan	Cash	$                 40,000.00
	Common Stock		$              2,000.00
	Additional paid in capital		$           38,000.00
9-Jan	Accounts Receivable	$                 16,800.00
	Service Revenue		$           16,800.00
10-Jan	Supplies	$                   5,700.00
	Accounts Payable		$              5,700.00
12-Jan	Treasury Stock	$                 23,100.00
	Cash		$           23,100.00
15-Jan	Accounts Payable	$                 17,300.00
	Cash		$           17,300.00
21-Jan	Cash	$                 49,900.00
	Service Revenue		$           49,900.00
22-Jan	Cash	$                 17,400.00
	Accounts Receivable		$           17,400.00
29-Jan	Dividends ($0.3*(18000+2000-1100))	$                   5,670.00
	Dividends Payable		$              5,670.00
30-Jan	Cash (900*23)	$                 20,700.00
	Treasury Stock (900*21)		$           18,900.00
	Additional Paid in capital		$              1,800.00
31-Jan	Salaries Expense	$                 42,800.00
	Cash		$           42,800.00

Date	Account Title	Debit	Credit
31-Jan	Utilities Expense	$                   7,000.00
	Utilities payable		$              7,000.00
31-Jan	Supplies Expense	$                   8,100.00
	Supplies ((8300+5700-5900))		$              8,100.00
31-Jan	Depreciation Expense	$                   1,700.00
	Accumulated Depreciation		$              1,700.00
	(72000-10800)/3 years / 12 months = 1700
31-Jan	Income tax expense	$                   2,800.00
	Income tax payable		$              2,800.00