ghwolf4p0m7x0
ghwolf4p0m7x0
12.03.2020 • 
Business

On January 1, 2021, the general ledger of Boomer Inc. includes the following account balances:

Cash $ 76,000
Accounts Receivable $48,000
Allowance for Uncollectible Accounts 11,000
Inventory 33,000
Building 73,000
Accumulated Depreciation 13,000
Land 203,000
Accounts Payable 23,000
Notes Payable (9%, due in 3 years) 36,000
Common Stock 103,000
Retained Earnings 247,000
Totals $433,000 $433,000

The $33,000 beginning balance of inventory consists of 300 units, each costing $110.
During January 2020, the following transactions occurred:

January 2 Received a $23,000 6-month, 6% note on a loan Boomer made to Cowboys, Inc.
January 5 Purchased 3,200 units of inventory on account for $480,000 ($150 each) with terms 1/10, n/30.
January 8 Returned 100 defective units of inventory purchased on January 5. January 15 Sold 3,000 units of inventory on account for $510,000 ($170 each) with terms 2/10, n/30. Record 2 entries for this transaction.
January 17 Customers returned 100 units sold on January 15. These units were originally purchased by Boomer on January 5. The units were placed in inventory to be sold in the future. Record 2 entries for this transaction.
January 20 Received cash from customers on accounts receivable. This amount includes $39,000 from 2019 plus the amount receivable on sale of 2,500 units sold on January 15.
January 21 Wrote off remaining accounts receivable from 2019.
January 24 Paid on accounts payable. The amount includes the amount owed at the beginning of the period plus the amount owed from the purchase of 2,800 units on January 5.
January 28 Paid cash for salaries during January, $31,000.
January 29 Paid cash for utilities during January, $13,000.
January 30 Paid dividends, $6,000.

The following information is available on January 31, 2020, for adjusting entries at the end of the month.
1. Boomer estimated that 10% of the January 31 accounts receivable balance will not be collected.
2. Accrued interest on notes receivable for January.
3. Accrued interest on notes payable for January.
4. Accrued income taxes at the end of January for $5,300.
5. Depreciation on the building, $2,300.

Required:
Make an adjusted multiple-step Income Statement for the company month ended January 31.

Solved
Show answers

Ask an AI advisor a question