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4. Prepare a multiple-step income statement for the period ended January 31, 2024. BIG BLAST FIREWORKS Multiple-Step Income Statement For the Month Ended January 31, 2024 Total operating expenses Operating income (loss) 0

4. Prepare a multiple-step income statement for the period ended January 31, 2024. BIG BLAST FIREWORKS Multiple-Step Income Statement For the Month Ended January 31, 2024 Total operating expenses Operating income (loss) 0

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 13RE: Refer to the information provided in RE8-4. If Paul Corporations inventory at January 1, 2019, had a...
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Exercise 6-21 (Algo) Part 4 4. Prepare a multiple-step income statement for the period ended January 31, 2024. BIG BLAST FIREWORKS Multiple-Step Income Statement For the Month Ended January 31, 2024 Total operating expenses Operating income (loss) 0
Transcribed Image Text:Exercise 6-21 (Algo) Part 4 4. Prepare a multiple-step income statement for the period ended January 31, 2024. BIG BLAST FIREWORKS Multiple-Step Income Statement For the Month Ended January 31, 2024 Total operating expenses Operating income (loss) 0
Required information Exercise 6-21 (Algo) Complete the accounting cycle using inventory transactions (LO6-2, 6-3, 6-5, 6-6, 6- 7) On January 1, 2024, the general ledger of Big Blast Fireworks includes the following account balances: Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Land Accounts Payable Notes Payable ( 8 %, due in 3 years) Common Stock Retained Earnings Totals Debit $24,900 44,000 45,000 84,100 $198,000 Credit $3,300 27,700 45,000 71,000 51,000 $198,000 The $45,000 beginning balance of inventory consists of 450 units, each costing $100. During January 2024, Big Blast Fireworks had the following inventory transactions: January 3 Purchase 1,350 units for $145,800 on account ($108 each). January 8 Purchase 1,450 units for $163,850 on account ($113 each). January 12 Purchase 1,550 units for $182,900 on account ($118 each). January 15 Return 175 of the units purchased on January 12 because of defects. January 19 Sell 4,500 units on account for $675,000. The cost of the units sold is determined using a FIFO perpetual inventory system. January 22 Receive $661,000 from customers on accounts receivable. January 24 Pay $440,000 to inventory suppliers on accounts payable. January 27 Write off accounts receivable as uncollectible, $2,400. January 31 Pay cash for salaries during January, $134,000. The following information is available on January 31, 2024. a. At the end of January, the company estimates that the remaining units of inventory purchased on January 12 are expected to sell in February for only $100 each. [Hint: Determine the number of units remaining from January 12 after subtracting the units returned on January 15 and the units assumed sold (FIFO) on January 19.] b. The company records an adjusting entry for $3,255 for estimated future uncollectible accounts. c. The company accrues interest on notes payable for January. Interest is expected to be paid each December 31. d. The company accrues income taxes at the end of January of $13,800.
Transcribed Image Text:Required information Exercise 6-21 (Algo) Complete the accounting cycle using inventory transactions (LO6-2, 6-3, 6-5, 6-6, 6- 7) On January 1, 2024, the general ledger of Big Blast Fireworks includes the following account balances: Accounts Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Land Accounts Payable Notes Payable ( 8 %, due in 3 years) Common Stock Retained Earnings Totals Debit $24,900 44,000 45,000 84,100 $198,000 Credit $3,300 27,700 45,000 71,000 51,000 $198,000 The $45,000 beginning balance of inventory consists of 450 units, each costing $100. During January 2024, Big Blast Fireworks had the following inventory transactions: January 3 Purchase 1,350 units for $145,800 on account ($108 each). January 8 Purchase 1,450 units for $163,850 on account ($113 each). January 12 Purchase 1,550 units for $182,900 on account ($118 each). January 15 Return 175 of the units purchased on January 12 because of defects. January 19 Sell 4,500 units on account for $675,000. The cost of the units sold is determined using a FIFO perpetual inventory system. January 22 Receive $661,000 from customers on accounts receivable. January 24 Pay $440,000 to inventory suppliers on accounts payable. January 27 Write off accounts receivable as uncollectible, $2,400. January 31 Pay cash for salaries during January, $134,000. The following information is available on January 31, 2024. a. At the end of January, the company estimates that the remaining units of inventory purchased on January 12 are expected to sell in February for only $100 each. [Hint: Determine the number of units remaining from January 12 after subtracting the units returned on January 15 and the units assumed sold (FIFO) on January 19.] b. The company records an adjusting entry for $3,255 for estimated future uncollectible accounts. c. The company accrues interest on notes payable for January. Interest is expected to be paid each December 31. d. The company accrues income taxes at the end of January of $13,800.
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