| Problem 3-8 Bridgeport Advertising was founded by Murali Vedula in January 2015. Presented below are both the adjusted and unadjusted trial balances as of December 31, 2017.
| BRIDGEPORT ADVERTISING
TRIAL BALANCE
DECEMBER 31, 2017 | | | Unadjusted | | Adjusted | | | Dr. | | Cr. | | Dr. | | Cr. | | Cash | | $16,740 | | | | | | $16,740 | | | | | | Accounts Receivable | | 19,170 | | | | | | 23,012 | | | | | | Supplies | | 9,760 | | | | | | 6,845 | | | | | | Prepaid Insurance | | 4,220 | | | | | | 2,625 | | | | | | Equipment | | 64,700 | | | | | | 64,700 | | | | | | Accumulated Depreciation-Equipment | | | | | $24,120 | | | | | | $29,050 | | | Notes Payable | | | | | 8,600 | | | | | | 8,600 | | | Accounts Payable | | | | | 1,890 | | | | | | 1,890 | | | Interest Payable | | | | | 0 | | | | | | 602 | | | Unearned Service Revenue | | | | | 5,350 | | | | | | 3,405 | | | Salaries and Wages Payable | | | | | 0 | | | | | | 756 | | | Common Stock | | | | | 19,220 | | | | | | 19,220 | | | Retained Earnings | | | | | 27,247 | | | | | | 27,247 | | | Dividends | | 19,300 | | | | | | 19,300 | | | | | | Service Revenue | | | | | 62,393 | | | | | | 68,180 | | | Salaries and Wages Expense | | 9,400 | | | | | | 10,156 | | | | | | Insurance Expense | | | | | | | | 1,595 | | | | | | Interest Expense | | | | | | | | 602 | | | | | | Depreciation Expense | | | | | | | | 4,930 | | | | | | Supplies Expense | | | | | | | | 2,915 | | | | | | Rent Expense | | 5,530 | | | | | | 5,530 | | | | | | | $148,820 | | | $148,820 | | | $158,950 | | | $158,950 | | | | | ![\"\"](\"//edugen.wileyplus.com/edugen/art2/common/pixel.gif\") | | | Journalize the annual adjusting entries that were made. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select \"No entry\" for the account titles and enter 0 for the amounts.)
| No. | Date | Account Titles and Explanation | Debit | Credit | | 1. | Dec. 31 | ![\"\"](\"//edugen.wileyplus.com/edugen/art2/common/pixel.gif\"/)
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| | | (To record accrued service revenue) | | | | 2. | Dec. 31 |
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| | | (To record supplies used) | | | | 3. | Dec. 31 |
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| | | (To expired insurance) | | | | 4. | Dec. 31 |
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| | | (To record depreciation on equiment) | | | | 5. | Dec. 31 |
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| | | (To record interest accrued on the note) | | | | 6. | Dec. 31 |
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| | | (To record service revenue earned) | | | | 7. | Dec. 31 |
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| | | (To record accrued wages) | | | | | | | | | Prepare an income statement for the year ended December 31. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
BRIDGEPORT ADVERTISING
Income Statement December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017 | | DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues | | | |
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| | DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues | | | |
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| | | Dividends Expenses Net Income / (Loss) Retained Earnings, Janaury 1 Retained Earnings, December 31 Revenues Total Expenses Total Revenues | |
| | DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues | | $
| | | | | | | Prepare a retained earnings statement for the year ended December 31. (List items that increase retained earnings first.)
BRIDGEPORT ADVERTISING
Retained Earnings Statement December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017 | | DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues | $
| | AddLess : DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues |
| | AddLess : DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues |
| | DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues | $
| | | | | | | Prepare a classified balance sheet at December 31. (List current assets in order of liquidity.)
BRIDGEPORT ADVERTISING
Balance Sheet December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017 | | Assets | | Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders\' Equity | | | | | | | |
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| | | | | Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Stockholders’ Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Stockholders’ Equity Total Long-term Investments Total Long-term Liabilities Total Property, Plant and Equipment Total Stockholders\' Equity | | | | | $
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| | | Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Stockholders’ Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Stockholders’ Equity Total Long-term Investments Total Long-term Liabilities Total Property, Plant and Equipment Total Stockholders\' Equity | | | | | $
| | | Liabilities and Stockholders’ Equity | | Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders\' Equity | | | | | | | |
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| | | | | Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Stockholders’ Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Stockholders’ Equity Total Long-term Investments Total Long-term Liabilities Total Property, Plant and Equipment Total Stockholders\' Equity | | | | | $
| | | Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders\' Equity | | | | | | | |
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| | | | | Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Stockholders’ Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Stockholders’ Equity Total Long-term Investments Total Long-term Liabilities Total Property, Plant and Equipment Total Stockholders\' Equity | | | | |
| | | Current Assets Current Liabilities Intangible Assets Liabilities Long-term Investments Long-term Liabilities Property, Plant and Equipment Stockholders’ Equity Total Assets Total Current Assets Total Current Liabilities Total Intangible Assets Total Liabilities Total Liabilities and Stockholders’ Equity Total Long-term Investments Total Long-term Liabilities Total Property, Plant and Equipment Total Stockholders\' Equity | | | | | $
| | | | | | | | Identify which accounts should be closed on December 31.
| 1. | | Rent Revenue Salaries and Wages Payable Notes Payable Insurance Expense Interest Payable Accounts Receivable Supplies Dividends Utilities Expenses Interest Expense Service Revenue Rent Expense Depreciation Expense Prepaid RentSalaries and Wages Expense Supplies Expenses Accounts Payable Unearned Rent Revenue Cash | | 2. | | Supplies Rent Expense Prepaid RentInterest Payable Utilities Expenses Insurance Expense Accounts Receivable Service Revenue Depreciation Expense Rent Revenue Salaries and Wages Expense Supplies Expenses Notes Payable Interest Expense Dividends Accounts Payable Unearned Rent Revenue Salaries and Wages Payable Cash | | 3. | | Supplies Expenses Rent Expense Supplies Depreciation Expense Utilities Expenses Interest Expense Dividends Notes Payable Salaries and Wages Expense Prepaid RentAccounts Payable Unearned Rent Revenue Salaries and Wages Payable Service Revenue Interest Payable Cash Accounts Receivable Insurance Expense Rent Revenue | | 4. | | Unearned Rent Revenue Interest Expense Insurance Expense Rent Revenue Service Revenue Accounts Payable Prepaid RentSalaries and Wages Expense Supplies Expenses Rent Expense Dividends Interest Payable Salaries and Wages Payable Utilities Expenses Depreciation Expense Cash Accounts Receivable Supplies Notes Payable | | 5. | | Interest Expense Dividends Salaries and Wages Expense Accounts Payable Salaries and Wages Payable Notes Payable Prepaid RentUtilities Expenses Cash Interest Payable Service Revenue Supplies Depreciation Expense Insurance Expense Accounts Receivable Supplies Expenses Unearned Rent Revenue Rent Revenue Rent Expense | | 6. | | Rent Expense Supplies Expenses Unearned Rent Revenue Interest Payable Prepaid RentDepreciation Expense Salaries and Wages Expense Accounts Payable Utilities Expenses Salaries and Wages Payable Insurance Expense Cash Accounts Receivable Supplies Interest Expense Dividends Service Revenue Rent Revenue Notes Payable | | 7. | | Insurance Expense Cash Interest Expense Supplies Expenses Dividends Notes Payable Interest Payable Prepaid RentRent Expense Rent Revenue Service Revenue Salaries and Wages Payable Salaries and Wages Expense Utilities Expenses Accounts Payable Accounts Receivable Unearned Rent Revenue Supplies Depreciation Expense | | 8. | | Cash Accounts Receivable Accounts Payable Unearned Rent Revenue Supplies Rent Expense Utilities Expenses Prepaid RentDepreciation Expense Insurance Expense Dividends Supplies Expenses Salaries and Wages Expense Service Revenue Salaries and Wages Payable Interest Payable Rent Revenue Interest Expense Notes Payable | | | | | | | If the note has been outstanding 10 months, what is the annual interest rate on that note? (Round answer to 1 decimal place, e.g. 7.5%.)
| The annual interest rate | |
| % | | | | | | If the company paid $10,440 in salaries and wages in 2017, what was the balance in Salaries and Wages Payable on December 31, 2016?
| Salaries and Wages Payable | | $
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