Adjusting Entries Milbank Repairs Service an electronics re

Adjusting Entries

Milbank Repairs & Service, an electronics repair store, prepared the following unadjusted trial balance at the end of its first year of operations:

For preparing the adjusting entries, the following data were assembled:

Required:

Fees earned but unbilled on June 30 were $9,340.

Supplies on hand on June 30 were $7,620.

Depreciation of equipment was estimated to be $12,900 for the year.

The balance in unearned fees represented the June 1 receipt in advance for services to be provided. During June $17,930 of the services was provided.

Unpaid wages accrued on June 30 were $1,650.

1. Journalize the adjusting entries necessary on June 30, 2019.

2. Determine the revenues, expenses, and net income of Milbank Repairs & Service before the adjusting entries.

3. Determine the revenues, expenses, and net income of Milbank Repairs & Service after the adjusting entries.

4. Determine the effect of the adjusting entries on Nancy Townes, Capital.
Nancy Townes, Capital by $.

Milbank Repairs & Service
Unadjusted Trial Balance
June 30, 2019
	Debit Balances	Credit Balances
Cash	12,900
Accounts Receivable	85,660
Supplies	20,640
Equipment	490,700
Accounts Payable			20,120
Unearned Fees			22,700
Nancy Townes, Capital			355,000
Nancy Townes, Drawing	17,030
Fees Earned			516,000
Wages Expense	119,710
Rent Expense	91,330
Utilities Expense	65,530
Miscellaneous Expense	10,320
	913,820		913,820

Solution

Uadjusted Trial Balance June 30th 2019 Heads   Debit Credit Cash $         12,900.00 Accounts Receivable $         85,660.00 Supplies $         20,640.00 Equipment $       490,700.00 Accounts Payable $                                   20,120.00 Unearned Fees $                                   22,700.00 Nancy\'s Townes Capital $                                355,000.00 Nancy\'s Townes Drawings $         17,030.00 Fees Earned $                                516,000.00 Wages Expenses $       119,710.00 Rent Expenses $         91,330.00 Utilities Expenses $         65,530.00 Miscellaneous Expenses $         10,320.00 Total $       913,820.00 $                                913,820.00 1) Adjusted Journal Entries Date Particular Amount (Dr) Amount 30th June Accounts Receivable $            9,340.00        To Fees Earned $                                     9,340.00 (Being amount of fees earned but unbilled) 30th June Supplies Expenses=($20640-$7620) $         13,020.00      To Office Supplies $                                   13,020.00 (Being amount of office supplies expenses 30th June Depreciation   $         12,900.00      To Accumulated Depreciation $                                   12,900.00 (Being amount of depreciation) 30th June Unearned Fees $         17,930.00        To Fees Earned $                                   17,930.00 (Being amount of Service performed against advance received earlier) 30th june Wages $            1,650.00     To Wages Payable $                                     1,650.00 (Being amount of Wages payable) 2) Revenues, expenses, and net income of Milbank Repairs & Service before the adjusting entries. Revenue: Fees Earned $                                516,000.00 Expenses: Wages Expenses $       119,710.00 Rent Expenses $         91,330.00 Utilties Expenses $         65,530.00 Miscellaneous Expenses $         10,320.00 $                                286,890.00 Net Income($516000-$286890) $                                229,110.00 3) Revenues, expenses, and net income of Milbank Repairs & Service before the adjusting entries. Revenue: Fees Earned=($516000+$9340+$17930) $                                543,270.00 Expenses: Wages Expenses=($119710+$1650) $       121,360.00 Rent Expenses $         91,330.00 Supplies Expenses $         13,020.00 Utilties Expenses $         65,530.00 Depreciation Expenses $         12,900.00 Miscellaneous Expenses $         10,320.00 $                                314,460.00 Net Income($543270-$314460) $                                228,810.00 4) Before Adjustments   Nancy Townes Capital $       355,000.00 Less: Drawings $         17,030.00 Add: Net Income $       229,110.00 Nancy Townes Capital $       567,080.00 After Adjustments Nancy Townes Capital $       355,000.00 Less: Drawings $         17,030.00 Add: Net Income $       228,810.00 Nancy Townes Capital $       566,780.00 Nancy\'s capital after adjustment is reduced by due to decrease in net income=($567080-$566780) $               300.00