Exercise 10-17 Complete the accounting cycle using stockholders' equity transactions (LO10-2, 10-4, 10-5, 10-8)

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

Accounts	Debit			Credit
Cash	$	42,700
Accounts Receivable		44,500
Supplies		7,500
Equipment		64,000
Accumulated Depreciation				$	9,000
Accounts Payable					14,600
Common Stock, $1 par value					10,000
Additional Paid-in Capital					80,000
Retained Earnings					45,100
Totals	$	158,700		$	158,700

During January 2021, the following transactions occur:

January		2		Issue an additional 2,000 shares of $1 par value common stock for $40,000.
January		9		Provide services to customers on account, $14,300.
January		10		Purchase additional supplies on account, $4,900.
January		12		Purchase 1,000 shares of treasury stock for $18 per share.
January		15		Pay cash on accounts payable, $16,500.
January		21		Provide services to customers for cash, $49,100.
January		22		Receive cash on accounts receivable, $16,600.
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 10,000 shares outstanding on January 1, 2021, and dividends are not paid on treasury stock.)
January		30		Resell 600 shares of treasury stock for $20 per share.
January		31		Pay cash for salaries during January, $42,000.

Exercise 10-17 Part 3

Unpaid utilities for the month of January are $6,200.

Supplies at the end of January total $5,100.

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 $10,000.

Accrued income taxes at the end of January are $2,000.

3. Prepare an adjusted trial balance as of January 31, 2021.

Answer is not complete.

GRAND FINALE FIREWORKS
Adjusted Trial Balance
January 31, 2021
Accounts	Debit	Credit
Cashselected answer correct	$83,900selected answer correct	not attempted
Accounts Receivableselected answer correct	42,200selected answer correct	not attempted
Suppliesselected answer correct	5,100selected answer correct	not attempted
Equipmentselected answer correct	64,000selected answer correct	not attempted
Accumulated Depreciationselected answer correct	not attempted	10,500selected answer correct
Accounts Payableselected answer correct	not attempted	3,000selected answer correct
Common Stockselected answer correct	not attempted	12,000selected answer correct
Additional Paid-in Capitalselected answer correct	not attempted	119,200selected answer correct
Retained Earningsselected answer correct	not attempted	6,400selected answer incorrect
Treasury Stockselected answer correct	7,200selected answer correct	not attempted
Utilities Expenseselected answer correct	6,200selected answer correct	not attempted
Supplies Expenseselected answer correct	2,400selected answer incorrect	not attempted
Depreciation Expenseselected answer correct	1,500selected answer correct	not attempted
Income Tax Expenseselected answer correct	2,000selected answer correct	not attempted
Service Revenueselected answer correct	not attempted	63,400selected answer correct
not attempted	not attempted	not attempted
not attempted	not attempted	not attempted
not attempted	not attempted	not attempted
not attempted	not attempted	not attempted
not attempted	not attempted	not attempted
not attempted	not attempted	not attempted
Totals	$214,500	$214,500

4. Prepare an income statement for the period ended January 31, 2021.

5. Prepare a classified balance sheet as of January 31, 2021