Homework SourseP44B Allesnik Advertising Agency was founded in January 2017
P4-4B Allesnik Advertising Agency was founded in January 2017. Presented here are both the adjusted and unadjusted trial balances as of December 31, 2017.
ALLESNIK ADVERTISING AGENCY
Trial Balance
December 31, 2017
Unadjusted
Adjusted
Cash
Dr.
Cr.
Dr.
Cr.
$
11,000
$
11,000
Accounts Receivable
16,000
19,000
Supplies
9,400
7,000
Prepaid Insurance
3,350
1,790
Equipment
60,000
60,000
Accumulated Depreciation—
Equipment
$
25,000
$
30,000
Notes Payable
8,000
8,000
Accounts Payable
2,000
2,000
Interest Payable
0
560
Unearned Service Revenue
5,000
3,100
Salaries and Wages Payable
0
820
Common Stock
20,000
20,000
Retained Earnings
5,500
5,500
Dividends
10,000
10,000
Service Revenue
57,600
62,500
Salaries and Wages Expense
9,000
9,820
Insurance Expense
1,560
Interest Expense
560
Depreciation Expense
5,000
Supplies Expense
2,400
Rent Expense
4,350
4,350
$
123,100
$
123,100
$
132,480
$
132,480
Instructions
(a)Journalize the annual adjusting entries that were made.
(b) Prepare an income statement and a retained earnings statement for the year ended December 31, and a classified balance sheet at December 31.
| Unadjusted | Adjusted | ||||||||||||||||||||
| Cash | Dr. | Cr. | Dr. | Cr. | |||||||||||||||||
| $ | 11,000 | $ | 11,000 | ||||||||||||||||||
| Accounts Receivable | 16,000 | 19,000 | |||||||||||||||||||
| Supplies | 9,400 | 7,000 | |||||||||||||||||||
| Prepaid Insurance | 3,350 | 1,790 | |||||||||||||||||||
| Equipment | 60,000 | 60,000 | |||||||||||||||||||
| Accumulated Depreciation— | |||||||||||||||||||||
| Equipment | $ | 25,000 | $ | 30,000 | |||||||||||||||||
| Notes Payable | 8,000 | 8,000 | |||||||||||||||||||
| Accounts Payable | 2,000 | 2,000 | |||||||||||||||||||
| Interest Payable | 0 | 560 | |||||||||||||||||||
| Unearned Service Revenue | 5,000 | 3,100 | |||||||||||||||||||
| Salaries and Wages Payable | 0 | 820 | |||||||||||||||||||
| Common Stock | 20,000 | 20,000 | |||||||||||||||||||
| Retained Earnings | 5,500 | 5,500 | |||||||||||||||||||
| Dividends | 10,000 | 10,000 | |||||||||||||||||||
| Service Revenue | 57,600 | 62,500 | |||||||||||||||||||
| Salaries and Wages Expense | 9,000 | 9,820 | |||||||||||||||||||
| Insurance Expense | 1,560 | ||||||||||||||||||||
| Interest Expense | 560 | ||||||||||||||||||||
| Depreciation Expense | 5,000 | ||||||||||||||||||||
| Supplies Expense | 2,400 | ||||||||||||||||||||
| Rent Expense | 4,350 | 4,350 | |||||||||||||||||||
| $ | 123,100 | $ | 123,100 | $ | 132,480 | $ | 132,480 | ||||||||||||||
Solution
a) Adjustment Journal Entries :
b) Income statement :
Balance Sheet as on Dec 31,
add: Net Income 38810
| Date | Accounts Titles | Debit $ | Credit $ |
| Dec 31 | AR | 3000 | |
| Sale Rev | 3000 | ||
| Supplies exp | 2400 | ||
| Supplies | 2400 | ||
| Insurance exp. | 1560 | ||
| prepaid Insurance | 1560 | ||
| Depreciation | 5000 | ||
| Acc Dep - Eq | 5000 | ||
| Interest Exp | 560 | ||
| Interest payable | 560 | ||
| Unearned Service Revenue | 1900 | ||
| Service Revenue | 1900 | ||
| salary and wages exp | 820 | ||
| Salary and wages payable | 820 |
