Debt

a$.$ On August $1,2024,$ Harriet's paid$-$off the note payable that was outstanding at the beginning of the period. The note had an $8\%$ interest rate, had been issued on August $1,2023,$ and required semiannual interest payments on Jan $31,2024,$ and July $31,2024.$

b$.$ On October $1,2024,$ Harriet's borrowed $$208,000$ on a new note payable. The new note carries a $12\%$ interest rate with semiannual interest payments required on March $31,2025,$ and September $30,2025.$

Operations

a$.$ Harriet's made a rent payment of $$300,000$ on August $1,2024.$ The payment was for rent on the store building and was prepaid for one year. The balance in the prepaid rent account at the end of $2023$ represents the rent for January through July $31,2024,$ that was paid for on August $1,2023.$

b$.$ Cash paid out during $2024$ for wages totaled $$236,000.$ Records indicate that salaries for the last week of December $2024$ amounted to $$85,000$ and would be paid at the end of the first week in January $2025($a two$-$week pay period$).$

c$.$ Other expenses $($paid in cash$)$ totaled $$93,000.$

Income Taxes

a$.$ On March $15,2024,$ Harriet's paid their $2023$ income taxes. Harriet's will pay their $2024$ income taxes on March $15,2025.$ Harriet's has a $35\%$ income tax rate for both $2023$ and $2024.$

Common Stock

a$.$ On January $1,2024,$ Harriet's issued $5,000$ additional shares of common stock for $$32$ per share.

b$.$ On December $1,2024,$ dividends of $$25,000$ were declared and paid.

Required:

Using the journal and T$-$accounts provided, record the transactions that occurred during $2024.$ If no specific date is provided for a transaction, leave the date column blank. IMPORTANT: Since there are several transactions for which no date is given, the journal entries do NOT need to be in chronological order. All adjusting and closing entries should have December $31,2024,$ as the date.

Prepare the balance sheet, statement of retained earnings, income statement, and statement of cash flows $($direct format$)$ for Harriet's Hats, Inc. for the year ended December $31,2024.$

Record the closing entries for the company $($this step is often skipped, don't lose these points$).$

Check Figures:

Basic Earnings Per Share: $$2\mathrm{.}84($rounded from $$2\mathrm{.}84075711)$

Total Current Assets: $$1,343,343$

Total Stockholders' Equity: $$832,448$

Net Cash from Operating Activities: $$234,120$