Required information

Exercise $6-21($Algo$)$ Complete the accounting cycle using inventory transactions $($LO$6-2,6-3,6-5,6-6,6-7)$

Skip to question

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

$$

AccountsDebitCreditCash$$25,500$Accounts Receivable$45,500$Allowance for Uncollectible Accounts$$$$3,900$Inventory$48,000$Land$88,600$Accounts Payable$26,200$Notes Payable $(8\%,$ due in $3$ years$)48,000$Common Stock$74,000$Retained Earnings$55,500$Totals$$207,600$$$207,600$

$$

The $$48,000$ beginning balance of inventory consists of $480$ units, each costing $$100.$ During January $2024,$ Big Blast Fireworks had the following inventory transactions:

$$

January $3$Purchase $1,650$ units for $$183,150$ on account $($$$111$ each$).$January $8$Purchase $1,750$ units for $$203,000$ on account $($$$116$ each$).$January $12$Purchase $1,850$ units for $$223,850$ on account $($$$121$ each$).$January $15$Return $190$ of the units purchased on January $12$ because of defects.January $19$Sell $5,400$ units on account for $$810,000.$ The cost of the units sold is determined using a FIFO perpetual inventory system.January $22$Receive $$793,000$ from customers on accounts receivable.January $24$Pay $$580,000$ to inventory suppliers on accounts payable.January $27$Write off accounts receivable as uncollectible, $$2,700.$January $31$Pay cash for salaries during January, $$137,000.$

$$

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

$$

At the end of January, the company estimates that the remaining units of inventory purchased on January $12$ are expected to sell in February for only $$100$ each. $[$Hint: Determine the number of units remaining from January $12$ after subtracting the units returned on January $15$ and the units assumed sold $($FIFO$)$ on January $19.]$

The company records an adjusting entry for $$2,700$ for estimated future uncollectible accounts.

The company accrues interest on notes payable for January. Interest is expected to be paid each December $31.$

The company accrues income taxes at the end of January of $$14,100.$

Exercise $6-21($Algo$)$ Part $1$

Required:

$1.$ Record each of the transactions listed above, assuming a FIFO perpetual inventory system. $($If no entry is required for a transaction$/$event$,$ select $"$No Journal Entry Required" in the first account field.$)$

$$

Prev

Question $4$ linked to $56$ up to $10$ of $10$ Total$456...10$ of $10$

Visit question mapNext