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Assuming AG is in the second year of operations in 2021, AG had beg account balances: Cash $3,000,000; A/R $100,000; Allowance for doubtful accounts $10,000 (credit balance); Common stock $1,400,000; APIC $1,600,000; and retained earnings of $90,000. Assume it has 10,000 shares outstanding Assume AG sells 2 distinct products: Product A and Product B which is both a product but also has a 12-month subscription requirement.

AG purchased inventory (Product A) on credit throughout the year: On 2/1-10,000 units at $30/unit; On 6/1 - 10,000 units at $20/unit; On 12/1-20,000 units at $25/unit. AG uses LIFO perpetual method and incorporates lower of cost or market in determining ending inventory. Assume the Market Value (NRV) of ending inventory is $145,000.

AG sells Product A on credit: On 2/25, AG sold 6,000 units for $70/unit. On 8/20, AG sold 12,000 units for $75/unit. On 12/15, AG sold 18,000 units for $90/unit. From opening balance: $10,000 was collected and $90,000 was written off from the opening balance. AG collected $300,000 in total cash for the first sale this year. In December, AG collected $2,000,000 from the later in the year sales. The uncollected amount from 2/25 has an uncollectible estimated rate of 20%. Any amount that remains is estimated to be uncollectable at 3%.

On April 1, AG purchased equipment for $600,000, paying $200,000 in cash and financing the rest through a long-term note that charges 5% interest until paid. No payment is required on the debt for 3 years. Depreciation expense is $100,000. AG purchased $50,000 of supplies with cash.

On 8/1 AG purchased $100,000 of stock that AG intends to hold for 5 years.

On 10/1, AG started selling Product B. AG purchased 100 units of inventory for Product B at a cost of $10/unit. The Fair Value Selling Price of B (product) is $60/unit. The Fair Value Selling Price of the subscription is $180/year. AG sold 40 units at Fair Value in exchange for cash. On 12/1 AG sold 60 units of Product B at a discounted total price $200/unit (includes product and service) for cash.

By year-end, AG Paid cash for rent (expense) of $50,000. AG invested $40,000 in a certificate of deposit (CD Account). 10% matures in February of next year and the remainder matures in July. AG paid $50,000 in dividends (cash) to the owners of AG. AG paid $553,000 towards it's A/P. At year-end $10,000 of supplies remained. AG received $2,000 of cash dividends and the fair value of the stock was $98,000. Accrue income tax at a rate of 20%. Please prepare journal entries, including closing entries, Income Statement and a Balance

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