90.2K

Verified Solution

Link Copied!

On January 1, 2020, the general ledger of Redbud Company includes the following account balances: Credit Debit $ 25,100 44,500 46,000 85,600 Accounts Cash Accounts Receivable Inventory Land Allowance for Uncollectible Accounts Accounts Payable Notes Payable (9%, due in 3 years) Common Stock Retained Earnings 3,500 27,200 46,000 72,000 52,500 Totals $ 201,200 $ 201,200 The $46,000 beginning balance of inventory consists of 460 units, each costing $100. During January 2020, Redbud had the following inventory transactions: January 3 Purchase 1,450 units for $158,050 on account ($109 each). January 8 Purchase 1,550 units for $176,700 on account ($114 each). January 12 Purchase 1,650 units for $196,350 on account ($119 each). January 15 Return 180 of the units purchased on January 12 because of defects. January 19 Sell 4,800 units on account for $720,000. The cost of the units sold is determined using a FIFO perpetual inventory system. Receive $705,000 from customers on accounts receivable. 22 24 y Pay $500,000 to inventory suppliers on accounts payable. The $46,000 beginning balance of inventory consists of 460 units, each costing $100. During January 2020, Redbud had the following inventory transactions: January 3 Purchase 1,450 units for $158,050 on account ($109 each). January 8 Purchase 1,550 units for $176,700 on account ($114 each). January 12Purchase 1,650 units for $196,350 on account ($119 each). January 15 Return 180 of the units purchased on January 12 because of defects. January 19Sell 4,800 units on account for $720,000. The cost of the units sold is determined using a FIFO perpetual inventory system. Receive $705,000 from customers on accounts receivable. Receive $705,000 January 22 January "Y Pay $500,000 to inventory suppliers on accounts payable. 24 Januar 27 Write off accounts receivable as uncollectible, $2,500. January 31Pay cash for salaries during January, $135,000. The following information is available on January 31, 2020. a. At the end of January, the estimated selling price of the remaining units of inventory is only $100 each. (Hint: find the number of units left by adding units in beginning inventory to the number of units purchased and subtracting the number of units sold.] b. The company estimated future uncollectible accounts by preparing an aging schedule. $5,600 of accounts receivable on January 31 are past due, and 35% of these accounts are estimated to be uncollectible. The rest of the accounts receivable are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Find the total accounts receivable on January 31 by looking in the general ledger.) C. Accrued interest expense on notes payable for January. Interest is expected to be paid each December 31. d. Accrued income taxes at the end of January are $13,900. Taxes will be paid in March, 2020. Redbud Company Classified Balance Sheet January 31, 2020 Assets Liabilities Current Assets: Current Liabilities: Total Current Liabilities Total Current Assets Total Liabilities Noncurrent Assets: Stockholders' Equity Total Stockholders' Equity 0 Total Liabilities & Stockholders' Equity Total Assets

Answer & Explanation Solved by verified expert

See Answer