Problem: The December 31, 2011 adjusted trial balance for Supplementary Corporation is presented below.
|
Account Title
|
Debits
|
|
Credits
|
| |
|
|
|
|
Cash
|
21,000
|
|
|
|
Accounts receivable
|
300,000
|
|
|
|
Allowance for uncollectible accounts
|
|
|
20,000
|
|
Prepaid rent expense
|
10,000
|
|
|
|
Inventory
|
50,000
|
|
|
|
Equipment
|
600,000
|
|
|
|
Accumulated depreciation - equip
|
|
|
250,000
|
|
Accounts payable
|
|
|
40,000
|
|
Note payable (due in six months)
|
|
|
60,000
|
|
Salaries payable
|
|
|
8,000
|
|
Interest payable
|
|
|
2,000
|
|
Capital stock
|
|
|
400,000
|
|
Retained earnings
|
|
|
100,000
|
|
Sales revenue
|
|
|
800,000
|
|
Cost of goods sold
|
480,000
|
|
|
|
Salaries expense
|
120,000
|
|
|
|
Rent expense
|
30,000
|
|
|
|
Depreciation expense
|
60,000
|
|
|
|
Interest expense
|
4,000
|
|
|
|
Bad debt expense
|
5,000
|
|
________
|
|
Totals
|
1,680,000
|
|
1,680,000
|
Required:
1. Prepare the necessary closing entries at December 31, 2011.
2. Prepare a multiple-step income statement at December 31, 2011.
3. Prepare a classified balance sheet at December 31, 2011.