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problem: Customers still more operates a private investigating agency called still more investigations. Some customers pay in advance for services; others are billed after services have been performed. Advanced payments are credited to an account entitled unearned retainer fees. Adjusting entries are performed on a monthly basis, the unadjusted trial balance accounts as of Dec. 31, 2008 are provided to you in random order as follows:

[Considering that adjusting entries have been made for the 1st eleven months of 2008, but not for the month of December]












Office equipment







Accounts payable







Unearned retainer fees







Accounts receivable







Retained earnings







Office supplies







Prepaid rent







Accumulated depreciation office equipment







Unexpired insurance

















Client fees earned










Interest payable










Capital stock










Depreciation expense-office equipment










Income tax payable










Notes payable










Office supplies expense









Rent expense










Insurance expense










Salaries expense










Interest expense










Income tax expense



























Other Information:

[A] Accrued but unrecorded client fees earned at Dec. 31 amounted to $1500

[B] records show that $2500 of cash receipts originally recorded as unearned retainer fees had been earned as of dec. 31

[C] office supplies on hand at Dec 31 amounts to $110

[D] the company purchased all of its office equipment when it first began business at that time the equipment estimated useful life was 6 years

[E] on oct. 1,2008 the company renewed its rental agreement paying $1,800 cash for 6 months rent in advance

[F] on march 1 of the current year the company paid $1080 cash to renew its 12 month insurance policy

[G] accrued but unrecorded salaries at Dec. 31 amount to $1900

[H] On June 1, 2008 the company borrowed money from the bank by signing a $9000, 8 percent, 12 month note payable. The entire note plus 12 months accrued interest is due on May 31 2009

[I] the company's CPA estimates that income taxes expense for the entire year is $7500

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M920649

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