Hassellhouf Company’s trial balance at December 31, 2017, is presented. All 2017 transactions have been recorded except for the items described.
On May 1, 2017, Hassellhouf purchased equipment for $21,200 plus sales taxes of $1,600 (all paid in cash).
On July 1, 2017, Hassellhouf sold for $3,500 equipment which originally cost $5,000. Accumulated depreciation on this equipment at January 1, 2017, was $1,800; 2017 depreciation prior to the sale of the equipment was $450.
On December 31, 2017, Hassellhouf sold on account $9,000 of inventory that cost $6,300.
Hassellhouf estimates that uncollectible accounts receivable at year-end is $3,500.
The note receivable is a one-year, 8% note dated April 1, 2017. No interest has been recorded.
The balance in prepaid insurance represents payment of a $3,600 6-month premium on September 1, 2017.
The building is being depreciated using the straight-line method over 30 years. The salvage value is $30,000.
The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The salvage value is 10% of cost.
The equipment purchased on May 1, 2017, is being depreciated using the straight-line method over 5 years, with a salvage value of $1,800.
The patent was acquired on January 1, 2017, and has a useful life of 10 years from that date.
Unpaid salaries and wages at December 31, 2017, total $5,200.
The unearned rent revenue of $6,000 was received on December 1, 2017, for 3 months’ rent.
Both the short-term and long-term notes payable are dated January 1, 2017, and carry a 9% interest rate. All interest is payable in the next 12 months.Instructions(a) Prepare journal entries for the transactions listed above.(b) Prepare an updated December 31, 2017, trial balance.Totals $1,205,040(c) Prepare a 2017 income statement and a retained earnings statement.(d) Prepare a December 31, 2017, classified balance sheet.Total assets $259,200CONTINUING PROBLEM COOKIE CREATIONS(Note: This is a continuation of the Cookie Creations problem from Chapters 1 through 8.)CC9 Natalie is also thinking of buying a van that will be used only for business. Natalie is concerned about the impact of the van’s cost on her income statement and balance sheet. She has come to you for advice on calculating the van’s depreciation.Go to the book’s companion website, www.wiley.com/college/weygandt, to see the completion of thi
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