Question

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

Accounts	Debit			Credit
Cash	$	22,300
Accounts Receivable		37,500
Allowance for Uncollectible Accounts				$	3,500
Inventory		32,000
Land		64,600
Accounts Payable					31,400
Notes Payable (9%, due in 3 years)					32,000
Common Stock					58,000
Retained Earnings					31,500
Totals	$	156,400		$	156,400

The $32,000 beginning balance of inventory consists of 320 units, each costing $100. During January 2021, Big Blast Fireworks had the following inventory transactions:

January		3		Purchase 1,100 units for $117,700 on account ($107 each).
January		8		Purchase 1,200 units for $134,400 on account ($112 each).
January		12		Purchase 1,300 units for $152,100 on account ($117 each).
January		15		Return 110 of the units purchased on January 12 because of defects.
January		19		Sell 3,700 units on account for $555,000. The cost of the units sold is determined using a FIFO perpetual inventory system.
January		22		Receive $533,000 from customers on accounts receivable.
January		24		Pay $363,000 to inventory suppliers on accounts payable.
January		27		Write off accounts receivable as uncollectible, $2,700.
January		31		Pay cash for salaries during January, $116,000.

The following information is available on January 31, 2021.

1. At the end of January, the company estimates that the remaining units of inventory are expected to sell in February for only $100 each.
2. The company estimates future uncollectible accounts. The company determines $4,200 of accounts receivable on January 31 are past due, and 40% 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.)
3. Accrued interest expense on notes payable for January. Interest is expected to be paid each December 31.
4. Accrued income taxes at the end of January are $12,500.

I need help creating the general ledger, income statement, balance sheet, and analysis please.

Answer 1

Big Blast Fireworks Journal entries Date Account 3-Jan Inventory Accounts Payable Credit Calculation Debit $ 117,700 $ 117,700 $ 134,400 8-Jan Inventory Accounts Payable $ 134,400 $ 152,100 12-Jan Inventory Accounts Payable $ 152,100 $ 12,870 =110*117 15-Jan Accounts Payable Inventory $ 12,870 $ 555,000 19-Jan Accounts Receivable Sales $ 555,000 $ 410,460 Wkgs below 19-Jan Cost of goods sold Inventory $ 410,460 $ 533,000 22-Jan Cash Accounts Receivable $ 533,000 $ 363,000 24-Jan Accounts Payable Cash $ 363,000 $ 2,700 27-Jan Allowance for Uncollectible Accounts Accounts Receivable $ 2,700 $ 116,000 $ 116,000 31-Jan Salaries expense Cash Adjusting entries 31-Jan Cost of goods sold Inventory $ 1,870 Wkgs below $ 1,870 $ 3,510 Wkgs below 31-Jan Bad debts expense Allowance for Uncollectible Accounts $ 3,510 $ 240 =32,000*9%*1/12 31-Jan Interest expense Interest Payable $ 240 $ 12,500 $ 12,500 31-Jan Income tax expense Income Tax Payable Closing entries 31-Jan Sales Income Summary $ 555,000 $ 555,000 $ 544,580 31-Jan Income Summary Cost of goods sold Salaries expense Bad debts expense Interest expense Income tax expense $ $ $ $ $ 412,330 116,000 3,510 240 12,500 $ 10,420 =555,000-554,580 31-Jan Income Summary Retained Earnings $ 10,420 Wkgs Cost of goods sold FIFO Inventory 1-Jan Beginning Balance 3-Jan Purchase 8-Jan Purchase 12-Jan Purchase 19-Jan Cost of goods sold Units Per Unit Cost Total Cost 320 $ 100 $ 1,100 $ 107 $ 1,200 $ 112 $ 1,080 $ 117 $ 3,700 32,000 117,700 134,400 126,360 410,460 Inventory Write down 12-Jan Purchase 15-Jan Purchase Returns 19-Jan Sales 31-Jan Inventory Cost-Ending Balance Inventory - Net Realisable Value Inventory Write down $ $ $ $ $ 1,300 $ (110) $ (1,080) $ 110 $ 110 $ 117 $ 152,100 117 $ (12,870) 117 $ (126,360) 12,870 100 $ 11,000 1,870 =12,870-11,000 1175 Bad debts expense Accounts Receivable Past due Not past due Total Accts Rec Ucollectible % Uncollectible Amount $ 4,200 40% $ 1,680 $ 52,600 5% $ 2,630 $ 56,800 4,310 Allowance for Uncollectible Accounts Beginning Balance Write off Unadjusted Ending Balance Adjusted Ending Balance Bad debts expense $ $ $ $ $ 3,500 (2,700) 800 4,310 From above table 3,510 -4,310-800

Date Big Blast Fireworks TAccounts Date Debit Date Credit Cash Op bal $ 22,300 22-Jan $533,000 24-Jan $363,000 31-Jan $116,000 Op bal 19-Jan Debit Date Credit Accounts Receivable $ 37,500 $555,000 22-Jan $533,000 27-Jan $ 2,700 Date Debit Date Credit Date Debit Date Credit Allowance for Uncollectible Accounts Inventory Op bal $ 3,500 Op bal $ 32,000 27-Jan $ 2,700 31-Jan $ 3,510 3-Jan $117,700 15-Jan $ 12,870 8-Jan $134,400 19-Jan $410,460 12-Jan $152,100 31-Jan $ 1,870 Bal. Bal. Bal. $ 76,300 Land $ 64,600 Bal. $ 4,310 Notes Payable (9%, due in 3 years) Op bal $32,000 $ 11,000 Interest Payable 31-Jan $ Op bal $ 56,800 Accounts Payable Op bal $ 31,400 $ 12,870 3-Jan $ 117,700 $363,000 8-Jan $134,400 12-Jan $152,100 240 15-Jan 24-Jan Bal. $ 59,730 $32,000 $ 240 $ 64,600 Income Tax Payable 31-Jan Bal. Common Stock Op bal Bal. Retained Earnings Op bal $ 12,500 $ 58,000 $ 31,500 $ 58,000 $ 31,500 Bal. $ 12,500 Sales 19-Jan $555,000 Bal. Cost of goods sold 19-Jan $410,460 31-Jan $ 1,870 Bal. Salaries expense 31-Jan $116,000 Bal. Bad debts expense 31-Jan $ 3,510 Bal. $555,000 $116,000 Bal. $ 3,510 Interest expense 31-Jan $ 240 Bal. $412,330 Income tax expense 31-Jan $ 12,500 Bal. $ 240 Bal. $ 12,500

Big Blast Fireworks Account Names Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Land Accounts Payable Interest Payable Income Tax Payable Notes Payable (9%, due in 3 years) Common Stock Retained Earnings Sales Cost of goods sold Salaries expense Bad debts expense Interest expense Income tax expense Totals Adjusted TB Debit Credit 76,300 56,800 4,310 11,000 64,600 59,730 240 12,500 32,000 58,000 31,500 555,000 412,330 116,000 3,510 240 12,500 753,280 753,280

555,000 412,330 142,670 116,000 Big Blast Fireworks Income Statement For Month ended Jan 31, 2021 Sales Cost of goods sold Gross profit Operating expenses Salaries expense Bad debts expense Total Operating expenses Operating Income Nonoperating items Interest expense Net Income before taxes Income tax expense Net Income 3,510 119,510 23,160 240 22,920 12,500 10,420 Statement of Retained Earnings For Month ended Jan 31, 2021 Beginning balance Net Income Ending Balance 31,500 10,420 41,920

Big Blast Fireworks Balance Sheet As of Jan 31, 2021 Assets Current Assets Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Total Current Assets 76,300 56,800 (4,310) 52,490 11,000 139,790 Non-Current Assets Land 64,600 204,390 Total Assets Liabilities & Stockholders Equity Current Liabilities Accounts Payable Interest Payable Income Tax Payable Total Current Liabilities 59,730 240 12,500 72,470 Non-Current Liabilties Notes Payable (9%, due in 3 years) Total Liabilties 32,000 104,470 Stockholders Equity Common Stock Retained earnings Total Stockholders Equity Total Liabilities & Stockholders Equity 58,000 41,920 99.920 204,390