Required information Exercise 7-21B Complete the accounting cycle using long-term asset transactions (LO7-4, 7-7) (The following information applies to the questions displayed below.) On January 1, Year 1, the general ledger of a company includes the following account balances: Credit Debit $ 59,000 25,600 $ 2,500 Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Notes Receivable (5%, due in 2 years) Land Accounts Payable Common Stock Retained Earnings Totals 36,600 15,600 158,000 15,100 223,000 54,200 $ 294,800 $ 294,800 During January Year 1, the following transactions occur: January 1 Purchase equipment for $19,800. The company estimates a residual value of $1,800 and a six-year service life. January 4 Pay cash on accounts payable, $9,800. January 8 Purchase additional inventory on account, $85,900. January 15 Receive cash on accounts receivable, $22,300. January 19 Pay cash for salaries, $30,100. January 28 Pay cash for January utilities, $16,800. January 30 Sales for January total $223,000. All of these sales are on account. The cost of the units sold is $116,500. Information for adjusting entries: a. Depreciation on the equipment for the month of January is calculated using the straight-line method. b. The company estimates future uncollectible accounts. The company determines $3,300 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.) c. Accrued interest revenue on notes receivable for January. d. Unpaid salaries at the end of January are $32,900. e. Accrued income taxes at the end of January are $9,300. Exercise 7-21B Part 3 3. Prepare an adjusted trial balance as of January 31, Year 1. Answer is not complete. Adjusted Trial Balance January 31, Year 1 Accounts Debit Credit >$ 250 3,610 65 32,900 X Depreciation Expense Bad Debt Expense Interest Receivable Salaries Expense Income Tax Expense Income Tax Payable Salaries Payable Interest Revenue Allowance for Uncollectible Accounts Accumulated Depreciation 000 9,300 9,300 32,900 65 6,110 250 Totals $ 46,125 $ 48,625