ACRS Hudson Corporation's balance sheet at December 31, 2021, is presented below. Hudson Corporation Balance Sheet December 31, 2021 Cash Accounts receivable Allowance for doubtful accounts Inventory 3 8 11 15 17 21 24 $13,100 19,780 (800) During January 2022, the following transactions occurred. Hudson uses the perpetual inventory method. Jan. 1 Hudson accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $1,200 account. Hudson wrote off as uncollectible the accounts of Walter Corporation ($450) and Drake Company ($280). Hudson purchased $17,200 of inventory on account. 9,400 $41,480 Accounts payable Common stock Retained earnings $ 8,750 20,000 12,730 27 31 Hudson paid other operating expenses, $3,218. $41,480 Hudson sold for $25,000 on account inventory that cost $17,500. Hudson sold inventory that cost $700 to Jack Rice for $1,000. Rice charged this amount on his Visa First Bank card. The service fee charged Hudson by First Bank is 3%. Hudson collected $22,900 from customers on account. Expand Your Critical Thinking Hudson paid $16,300 on accounts payable. Hudson received payment in full ($280) from Drake Company on the account written off on January 3. Hudson purchased advertising supplies for $1,400 cash. Adjustment data: 1. Interest is recorded for the month on the note from January 1. 2. Bad debts are expected to be 6% of the January 31, 2022, accounts receivable. 3. A count of advertising supplies on January 31, 2022, reveals that $560 remains unused. 4. The income tax rate is 30%. (Hint: Prepare the income statement up to Income before taxes and multiply by 30% to compute the amount; round to whole dollars.) Instructions (You may want to set up T-accounts to determine ending balances.) a. Prepare journal entries for the transactions listed above and adjusting entries. (Include entries for cost of goods sold using the perpetual inventory system.) b. Prepare an adjusted trial balance at January 31, 2022. c. Prepare an income statement and a retained earnings statement for the month ending January 31, 2022, and a classified balance sheet as of January 31, 2022.

ACRS Hudson Corporation's balance sheet at December 31, 2021, is presented below. Hudson Corporation Balance Sheet December 31, 2021 Cash Accounts receivable Allowance for doubtful accounts Inventory 3 8 11 15 17 21 24 $13,100 19,780 (800) During January 2022, the following transactions occurred. Hudson uses the perpetual inventory method. Jan. 1 Hudson accepted a 4-month, 8% note from Betheny Company in payment of Betheny's $1,200 account. Hudson wrote off as uncollectible the accounts of Walter Corporation ($450) and Drake Company ($280). Hudson purchased $17,200 of inventory on account. 9,400 $41,480 Accounts payable Common stock Retained earnings $ 8,750 20,000 12,730 27 31 Hudson paid other operating expenses, $3,218. $41,480 Hudson sold for $25,000 on account inventory that cost $17,500. Hudson sold inventory that cost $700 to Jack Rice for $1,000. Rice charged this amount on his Visa First Bank card. The service fee charged Hudson by First Bank is 3%. Hudson collected $22,900 from customers on account. Expand Your Critical Thinking Hudson paid $16,300 on accounts payable. Hudson received payment in full ($280) from Drake Company on the account written off on January 3. Hudson purchased advertising supplies for $1,400 cash. Adjustment data: 1. Interest is recorded for the month on the note from January 1. 2. Bad debts are expected to be 6% of the January 31, 2022, accounts receivable. 3. A count of advertising supplies on January 31, 2022, reveals that $560 remains unused. 4. The income tax rate is 30%. (Hint: Prepare the income statement up to Income before taxes and multiply by 30% to compute the amount; round to whole dollars.) Instructions (You may want to set up T-accounts to determine ending balances.) a. Prepare journal entries for the transactions listed above and adjusting entries. (Include entries for cost of goods sold using the perpetual inventory system.) b. Prepare an adjusted trial balance at January 31, 2022. c. Prepare an income statement and a retained earnings statement for the month ending January 31, 2022, and a classified balance sheet as of January 31, 2022.

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

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 2RE: Use the same information in RE9-1 except that the note is not interest bearing. Assume that the note...

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