pare a Collll Year 13 c. Pre tions and preparation of income statement and balance sheet. Refer 23. Corporation for January, Year 13, in Chapter 2, Problem l: The firm pays the two-year insurance premium of $2,400 for fire and uires merchandise costing $1,050,000. Of this amount, $1,455 is from ation for Patterson to the inform 2.14, above. The following transactions occur during February. liability coverage beginning February1 February 5: Acq liers to whom Patterson returned defective merchandise during January but for supp tion acquired the remaining purchases on account. S4,500 was to customers who had advanced Patterson Corporation cash during Janu- which the firm had not yet received a refund for amounts paid. Patterson Corpora (3) During February: Sells merchandise to customers totaling S1,500,000. Of this amount, ary. Patterson Corporation makes the remaining sales on account. (4) During February: The cost of the goods sold in transaction (3) was $950,000. 5) During February: Pays in cash selling and administrative expenses of $235,000. ing February: Collects $1,206,000 from customer for sales previously made on account. 7) During February: Pays $710,000 to suppliers of merchandise for purchases previously (8) February 28: Recognizes rent expense for February (9) February 28: depreciation made on account. Recognizes depreciation expense of $2,500 for February. Patterson Cor- poration uses an Accumulated Depreciation account. (10) February 28: ecognizes amortization expense of $450 on the patent. Patterson Cor- amortiz