Final answer:
A balance sheet lists assets and liabilities. To calculate the merchandise balance, add up the value of all merchandise on hand. To calculate the current account balance, subtract liabilities from assets.
Step-by-step explanation:
A balance sheet is an accounting tool that lists assets and liabilities. It is typically represented in a T-account format with two columns for assets and liabilities.
To calculate the merchandise balance, you would add up the value of all the merchandise the company has on hand. To calculate the current account balance, you would subtract the value of all the liabilities from the value of all the assets.
It is important to note that the specific transaction data needed to prepare the cash basis balance sheet and accrual basis balance sheet as of January is not provided in the question.