Question

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

Accounts	Debit			Credit
Cash	$	44,200
Accounts Receivable		47,500
Supplies		9,000
Equipment		79,000
Accumulated Depreciation				$	10,500
Accounts Payable					16,100
Common Stock, $1 par value					15,000
Additional Paid-in Capital					95,000
Retained Earnings					43,100
Totals	$	179,700		$	179,700

During January 2021, the following transactions occur:

January		2		Issue an additional 2,200 shares of $1 par value common stock for $44,000.
January		9		Provide services to customers on account, $18,300.
January		10		Purchase additional supplies on account, $6,400.
January		12		Purchase 1,000 shares of treasury stock for $22 per share.
January		15		Pay cash on accounts payable, $18,000.
January		21		Provide services to customers for cash, $50,600.
January		22		Receive cash on accounts receivable, $18,100.
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 15,000 shares outstanding on January 1, 2021, and dividends are not paid on treasury stock.)
January		30		Resell 900 shares of treasury stock for $24 per share.
January		31		Pay cash for salaries during January, $43,500.

The following information is available on January 31, 2021.

1. Unpaid utilities for the month of January are $7,700.
2. Supplies at the end of January total $6,600.
3. Depreciation on the equipment for the month of January is calculated using the straightline method. At the time the equipment was purchased, the company estimated a service life of three years and a residual value of $11,500.
4. Accrued income taxes at the end of January are $2,600.

Choose the appropriate accounts to complete the company's balance sheet. Make sure to select 'adjusted' from the dropdown, which will then populate the balances in those accounts from the adjusted trial balance. Post-closing Grand Finale Fireworks Classified Balance Sheet January 31, 2021 Assets Liabilities Current Assets: Current Liabilities: Total Current Assets Noncurrent Assets: Total Current Liabilities Stockholders' Equity Total Stockholders' Equity Total Liabilities & Stockholders' Equity Total Assets $ 0 | $ 0 < Income Statement Analysis >

Answer 1

Step 1 Transation for Jan 2021 Particulars 2-Jan-21 Cash Debit S44,000 Credit Sr.No. Date 1 Common Stock Additional Paid-in Capital (To record issue of common stock) $2,200 $41,800 9-Jan-21 Accounts Receivable Service Revenue (To record service revenue) $18,300 2 $18,300 10-Jan-21 Supplies $6,400 Accounts Payable (To record purchase of supplies) $6,400 $22,000 12-Jan-21 Treasury Stock 4 $22,000 Cash (To record purchase of treasury stock) $18,000 15-Jan-21 Accounts Payable Cash (To record payment to account payable) $18,000 $50,600 21-Jan-21 Cash Service Revenue (To record service revenue) $50,600 $18,100 22-Jan-21 Cash 7 Accounts Receivable (To Record collection of accounts receivable) $18,100 29-Jan-21 Retained Earnings $4,200 8 Dividend payable (To record declaration of dividend) $4,200 $21,600 30-Jan-21 Cash $900 $20,700 Common Stock Paid in Capital Treasury Stock (To record reissue of treasuy stock) 31-Jan-21 Salary Expense $43,500 10 Cash $43,500 To Record salary expense)

Step 2 Adjusting Entry Date 31-Jan-21 Utilities Expense Particulars Debit $7,700 Credit Accounts Payable (To record accrual of utilities expense) $7,700 31-Jan-21 Supplies Expense $8,800 Supplies (To record supplies expense) $8,800 31-Jan-21 Depreciation $1,875 $1,875 Accumulated Depreciation (To Record depreciation on equipment) $2,600 31-Jan-21 Income Tax Income Tax Payable (To Record income tax provision) $2,600 Working 1 Supplies Expense Beginning Supplies as on Jan 1, 2021 Add: Purchase Less: Ending Supplies as in Jan 31, 2021 Supplies Expense $9,000 $6,400 (56,600) $8,800 2 Depreciation Cost $79,000 ($11,500) $67,500 Less: Salvage Value Net Useful life (in years) Per Year Depreciation [$67500/3] Depreciation for January [$22500/12] 3 $22,500 $1,875

Step 3 Grand Finale Fireworks Adjusted Trail Balance January 31, 2021 Debit Trial Balance Entry Adjustment January 1, 2021 Debit Debit $134,300 $18,300 $6,400 S0 S0 $18,000 S0 S0 S0 S0 S0 $22,000 $4,200 S0 $43,500 $7,700 $8,800 $1,875 $2,600 Credit $83,500 $18,100 $8,800 $0 $1,875 $14,100 $2,600 $4,200 $3,100 $41,800 $20,700 S0 $0 $68,900 S0 S0 $0 S0 S0 Credit Particulars Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Credit $95,000 $47,700 $6,600 $79,000 $44,200 $47,500 $9,000 $79,000 $10,500 $16,100 $12,375 $12,200 $2,600 $4,200 $18,100 $136,800 $20,700 Accounts Payable Income Tax Payable Dividend Payable $15,000 $95,000 S0 Common Stock Additional Paid-in Capital Paid in Capital Treasury Stock Treasury Stock Retained Earnings Service Revenue Salary Expense Utilities Expense Supplies Expense Depreciation $22,000 $43,100 $38,900 $68,900 $43,500 $7,700 $8,800 $1,875 $2,600 Income Tax $179,700 $267,675 $314,775 $314,775 $267,675 $179,700

Grand Finale Fireworks Step 4 Income Statement For the year ended 31st January 2021 Amount Particulars Service Revenue Less: Operating Expense Salary Expense Utilities Expense Supplies Expense Depreciation Total Operating Expense Net Income Before Tax Less: Income Tax Net Income Amount $68,900 $43,500 $7,700 $8,800 $1,875 ($61,875) $7,025 (S2,600) $4,425 Grand Finale Fireworks Step 5 Statement of Retained Earnings For the year ended 31st January 2021 Particulars Beginning Balance Add: Net Income Amount $43,100 $4,425 $47,525 (S4,200) $43,325 Less: Dividend Ending Balance

Grand Finale Fireworks Ans Classified Balance Sheet January 31, 2021 Liabilities Accounts Payable Dividend Payable Assets Amount Amount Amount Cash $95,000 $47,700 S6,600 $12,200 $4,200 Accounts Receivable Supplies $2,600 $19,000 Income Tax Payable $149,300 Total Current Liabilities Total Current Assets Non Current Assets Equipment Less: Accumulated Depreciation Shareholders' Equity Common Stock $66,625 Additional Paid-in Capital Paid in Capital Treasury Stock Retained Earnings $79,000 ($12,375) $18,100 $136,800 $20,700 $43,325 Less: Treasury Stock Total Shareholders' Equity ($22,000) $196,925 $215,925 Total Liabilities and Shareholder's Equity Total Assets $215,925