Transcribed Image Text: 5. Prepare a classified balance sheet as of January 31, 2021. (Deductible amounts should be indicated with a minus sign.) TNT FIREWORKS Balance Sheet January 31, 2021

Transcribed Image Text: 5. Prepare a classified balance sheet as of January 31, 2021. (Deductible amounts should be indicated with a minus sign.)
TNT FIREWORKS
Balance Sheet
January 31, 2021
Assets
Liabilities
Cash
Accounts Payable
Accounts Receivable
Total Current Liabilities
Total Current Assets
Stockholder’s Equity
Total Stockholders’ Equity
Total Assets
$
Total Liabilities and Stockholders’ Equity
$ Transcribed Image Text: On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances:
Accounts
Debit
Credit
$ 59,000
25,600
2$
36,600
15,600
158,000
Cash
Accounts Receivable
Allowance for Uncollectible Accounts
Inventory
Notes Receivable (5%, due in 2 years)
2,500
Land
Accounts Payable
15,100
Common Stock
223,000
54,200
Retained Earnings
Totals
$294,800
$294,800
During January 2021, the following transactions occur:
January 1 Purchase equipment for $19,800. The company estimates a residual value of $1,800 and a six-year service life.
January 4 Pay cash on accounts payable, $9,800.
January 8 Purchase additional inventory on account, $85,900.
January 15 Receive cash on accounts receivable, $22,300.
January 19 Pay cash for salaries, $30,100.
January 28 Pay cash for January utilities, $16,800.
January 30 Sales for January total $223,000. All of these sales are on account. The cost of the units sold is $116,500.
Information for adjusting entries:
a. Depreciation on the equipment for the month of January is calculated using the straight-line method.
b. The company estimates future uncollectible accounts. The company determines $3,300 of accounts receivable on January 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaining
accounts receivable on January 31 are not past due, and 2% of these accounts are estimated to be uncollectible. (nt: Use the January 31 accounts receivable balance calculated in the general ledger.)
c. Accrued interest revenue on notes receivable for January.
d. Unpaid salaries at the end of January are $32,900.
e. Accrued income taxes at the end of January are $9,300.

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