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1. Assuming in its first year of operations in 2018, that ABC issued 100,000 shares of 3.00 par stock to an investor for $800,000.

On January 2, ABC issued bonds with a face of 200,000, stated rate of 9%, term 5 years and received cash of either $195,000 or $205,000. Market Rate is 10%. Interest is paid every January 1

On March 1, ABC financed machinery. The cost of the machinery was $100,000. ABC financed this through a long-term note that charges interest of 8%. The interest is payable each January 1 starting next year. The $100,000 is to be paid back on January 1 of the 5^th year.

ABC acquired an investment in stock of another company for $50,000. The investment did not change in value at 12/31.

ABC purchased inventory on credit throughout the year. The inventory purchases were on 1/20/18 - 20,000 units at $1.00/unit; on 6/1 10,000 at $2.00/unit; and finally, on 9/1 they purchased 20,000 units at $3.00/unit. ABC uses LIFO periodic method (on an annual basis) for accounting for inventory.

On 9/1 ABC sold 15,000 units at a total price of $160/unit on credit.

On 12/1 ABC sold 20,000 units at a total price of $140/unit on credit

ABC received $1,500,000 of cash for credit sales and wrote off $40,000 as bad debts at year-end. Assuming that ABC uses the aging method and that the aging method determined that 80% of its ending balance of AR is current with a 2% likely uncollectible rate; and that 20% of the ending balance is noncurrent with a likely 20% uncollectible rate

ABC purchased $250,000 worth of supplies on credit. By year-end only 20% of supplies remained.

ABC received $800,000 of cash in advance for delivery of 5,000 units of inventory. This inventory will be delivered January of next year.

ABC had depreciation expense related to the machinery of $5,000. Paid cash for rent (expense) of $20,000. Total salary expense was $1,200,000; of which 1,000,000 was paid in cash and ABC owed the remainder at year-end. ABC paid down of its A/P with cash. ABC incorporates the Lower of Cost or Market in determining ending inventory. Assume that the lower of cost or market value of the inventory suggested a value of $12,000.

Accrue income tax at a rate of 21%. ABC received $1,000 in divdends but paid $23,000 in dividends to its owners.

Please prepare all Journal Entries (including closing entries);

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