Nevada Camping Equipment Rental Company occupies rented quarters on the main street of Las Vegas. To get this location, the company rented a store larger than needed and subleased (rented) a portion of the area to Max's Restaurant. The partial trial balance of Nevada Camping Equipment Rental Company as of 2010 December 31, is as follows:
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NEVEDA CAMPING EQUIPMENT RENTAL COMPANY
Trial Balance
2010 December 31
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Debits
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Credits
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Cash
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$100,000
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Prepaid Insurance
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11,400
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Supplies on Hand
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20,000
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Camping Equipment
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176,000
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Accumulated Depreciation-Camping Equipment
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$19,200
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Notes Payable
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40,000
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Equipment Rental Revenue
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1,500,000
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Sublease Rental Revenue
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8,800
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Building Rent Expense
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14,400
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Salaries Expense
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196,000
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a. Salaries of employees amount to USD 300 per day and were last paid through Wednesday, December 27. December 31 is a Sunday. The store is closed Sundays.
b. An analysis of the Camping Equipment account disclosed:
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Balance, 2010 January 1
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$128,000
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Addition, 2010 July 1
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48,000
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Balance, 2010 December 31, per trial balance
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$176,000
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The company estimates that all equipment will last 20 years from the date they were acquired and that the residual value will be zero.
c. The store carries one combined insurance policy, which is taken out once a year effective August
1. The premium on the policy now in force amounts to USD 7,200 per year.
d. Unused supplies on hand at 2010 December 31, have a cost of USD 9,200.
e. December's rent from Max's Restaurant has not yet been received, USD 800.
f. Interest accrued on the note payable is USD 700.
Prepare the annual year-end entries required by the preceding statement of facts.