Exercise $9-24($Algo$)$ Complete the accounting cycle using long$-$term liabilitiy transactions $($LO$9-2,9-8)($GL$)$

On January $1,2024,$ the general ledger of Freedom Fireworks includes the following account balances:

Accounts Debit Credit

Cash $ $13,000$

Accounts Receivable $37,600$

Allowance for Uncollectible Accounts $ $3,600$

Inventory $153,800$

Land $85,300$

Buildings $138,000$

Accumulated Depreciation $11,400$

Accounts Payable $37,500$

Common Stock $218,000$

Retained Earnings $157,200$

Totals $ $427,700$ $ $427,700$

During January $2024,$ the following transactions occur:

January $1$ Borrow $$118,000$ from Captive Credit Corporation. The installment note bears interest at $6\%$ annually and matures in $5$ years. Payments of $$2,281$ are required at the end of each month for $60$ months.

January $4$ Receive $$32,800$ from customers on accounts receivable.

January $10$ Pay cash on accounts payable, $$29,000.$

January $15$ Pay cash for salaries, $$30,700.$

January $30$ Firework sales for the month total $$210,600.$ The cost of the units sold is $$121,500.$

January $31$ Pay the first monthly installment of $$2,281$ related to the $$118,000$ borrowed on January $1.$

The following information is available on January $31,2024.$

Depreciation on the building for the month of January is calculated using the straight$-$line method. At the time the building was purchased, the company estimated a service life of $10$ years and a residual value of $$25,800.$

The company estimates additional future uncollectible accounts of $$3,114.$

Unpaid salaries at the end of January are $$27,900.$

Accrued income taxes at the end of January are $$9,800.$

The portion of Notes Payable $($long$-$term$)$ due within the next $12$ months is reclassified as Notes Payable $($current$).$ The amount of the reclassification is $$20,967.1.$ Record each of the transactions listed above in the 'General Journal' tab $($these are shown as items $1$ to $7)$ assuming a FIFO perpetual inventory system. Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances.

$2.$ Record adjusting entries on January $31.$ in the 'General Journal' tab $($these are shown as items $8$ to $12).$

$3.$ Review the adjusted 'Trial Balance' as of January $31,2024,$ in the 'Trial Balance' tab.

$4.$ Prepare a multiple$-$step income statement for the period ended January $31,2024,$ in the 'Income Statement' tab.

$5.$ Prepare a classified balance sheet as of January $31,2024,$ in the 'Balance Sheet' tab.

$6.$ Record the closing entries in the 'General Journal' tab $($these are shown as items $13$ and $14).$

$7.$ Using the information from the requirements above, complete the 'Analysis' tab.