Answer:
Big Blast Fireworks
a) General Journal to record transactions:
Jan. 3
Debit Inventory $196,000
Credit Accounts Payable $196,000
To record the purchase of 1,750 units at $112 each
Jan. 8
Debit Inventory $216,450
Credit Accounts Payable $216,450
To record the purchase of 1,850 units at $117 each
Jan. 12
Debit Inventory $237,900
Credit Accounts Payable $237,900
To record the purchase of 1,950 units at $122 each
Jan. 15
Debit Accounts Payable $23,790
Credit Inventory $23,790
To record the return of 195 units at $122 each.
Jan. 19
Debit Accounts Receivable $855,000
Credit Sales Revenue $855,000
To record the sale of 5,700 units on account.
Debit Cost of Goods Sold $657,870
Credit Inventory $657,870
To record the cost of sales of 5700 units.
Jan. 22
Debit Cash Account $837,000
Credit Accounts Receivable $837,000
To record cash receipt from customers.
Jan. 24
Debit Accounts Payable $620,000
Credit Cash Account $620,000
Jan. 27
Debit Allowance for Uncollectible Accounts $2,800
Credit Accounts Receivable $2,800
To record the write-off of uncollectible.
Jan. 31
Debit Salaries & Wages Expense $138,000
Credit Cash Account $138,000
To record the payment of cash for salaries
2. Adjusting Entries on January 31, 2021:
Debit Loss on Inventory $3,190
Credit Inventory $3,190
To record the loss in value.
Debit Allowance for Uncollectible Accounts $2,065
Credit Accounts Receivable $2,065
To record the write-off of uncollectible.
Debit Uncollectible Expense $3,722
Credit Allowance for Uncollectible Accounts $3,722
To bring the allowance for uncollectible accounts to $2,957.
Debit Interest on Notes Payable $245
Credit Interest Payable $245
To record accrued interest for the month
3. Adjusted Trial Balance at January 31, 2021:
                                                   Debit           Credit 
Cash                                       $104,700 
Accounts Receivable                59,135 
Allowance for Uncollectible Accounts          2,957
Beginning Inventory                                    49,000 
Ending Inventory                       14,500 
Land                                           90,100
Salaries                                    138,000
Loss on Inventory                       3,190
Uncollectible Expense               3,722
Interest on Notes Payable           245
Cost of Goods Sold               657,870
Sales Revenue                                          855,000
Accounts Payable                                       32,260 
Notes Payable (6%, due in 3 years)          49,000
Interest on Notes Payable                              245 
Common Stock                                          75,000 
Retained Earnings                                     57,000 
Totals                                 $1,071,462 $1,071,462
Balance Sheet at January 31, 2021:
Assets:
Cash                            $104,700 
Accounts Receivable      59,135
Less uncollectible allw.  -2,957
Inventory                         14,500
Land                                90,100
Total  $265,478
Liabilities:
Accounts Payable                             32,260 
Notes Payable (6%, due in 3 years) 49,000
Interest on Notes Payable                      245       $81,505
 
Common Stock                                   75,000 
Retained Earnings                             108,973     $183,973
Total $265,478
Explanation:
a)  Unadjusted Trial Balance at January 1, 2021:
                                                   Debit           Credit 
Cash                                       $ 25,700 
Accounts Receivable                46,000 
Allowance for Uncollectible Accounts          4,100 
Inventory                                   49,000 
Land                                           90,100 
Accounts Payable                                       25,700 
Notes Payable (6%, due in 3 years)          49,000 
Common Stock                                          75,000 
Retained Earnings                                     57,000 
Totals                                 $ 210,800 $ 210,800
b) Accounts Receivable
Beginning balance     $46,000
Credit Sales             $855,000
less write-off                  -2800
less write-off                 -2,065
less cash receipts  -$837,000
Ending balance          $59,135
c) Estimated uncollectible allowance = $2,957 (5% of accounts receivable balance, i.e $59,135)
d) Uncollectible Expense:
Ending balance       $2957
Plus write-off            2,800
plus write-off            2,065
Beginning balance  -4,100
Uncollectible expense   3,722
e) Cash Account balance:
Beginning balance        $25,700
Cash from customers $837,000
Payment to suppliers-$620,000
Salaries                       -$138,000
Ending balance           $104,700
f) Accounts Payable
Beginning balance    $25,700
Inventory:
      1,750 units for     $196,000 
      1,850 units for     $216,450 
      1,950 units for    $237,900 
       195 units return -$23,790
less payment         -$620,000
Ending Balance        $32,260
g) Income Statement:
Sales                     $855,000
less cost of sales   -657,870
Gross Income         $197,130
Salaries                  -138,000
Loss on Inventory     -3,190
Uncollectible Exp     -3,722
Interest on Note         -245
Net Income           $51,973
Retained Earning  57,000
Ending R/Earnings$108,973
Cost of Goods Sold, using FIFO:
490 units at $100 each       $49,000
1,750 units at $112 each    $196,000 
1,850 units at $117 each    $216,450
1,610 units at $122 each   $196,420
7,500 units sold                $657,870