Required information Exercise 7-21B Complete the accounting cycle using long-term asset transactions (LO7-4, 7-7) On January 1, Year 1, the general ledger of a company includes the following account balances: Accounts Debit Credit Cash $ 59,500 Accounts Receivable 26,600 Allowance for Uncollectible Accounts $ 3,000 Inventory 37,100 Notes Receivable (5%, due in 2 years) 21,600 Land 163,000 Accounts Payable 15,600 Common Stock 228,000 Retained Earnings 61,200 Totals $ 307,800 $ 307,800 During January Year 1, the following transactions occur: January 1 Purchase equipment for $20,300. The company estimates a residual value of $2,300 and a five-year service life. January 4 Pay cash on accounts payable, $10,300. January 8 Purchase additional inventory on account, $90,900. January 15 Receive cash on accounts receivable, $22,800. January 19 Pay cash for salaries, $30,600. January 28 Pay cash for January utilities, $17,300. January 30 Sales for January total $228,000. All of these sales are on account. The cost of the units sold is $119,000. Information for adjusting entries: Depreciation on the equipment for the month of January is calculated using the straight-line method. The company estimates future uncollectible accounts. The company determines $3,800 of accounts receivable on January 31 are past due, and 50% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 2% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.) Accrued interest revenue on notes receivable for January. Unpaid salaries at the end of January are $33,400. Accrued income taxes at the end of January are $9,800.