Work Problems 1
09, At the end of the first three months of operation, Evergreen Repairs, Inc.'s trial balance is as
Evergreen Repair, Inc.
Trial Balance
March 31, 2014
|
Cash
|
7,983
|
|
|
Accounts Receivable
|
5,872
|
|
|
Office supplies
|
970
|
|
|
Repair, Rent
|
1,500
|
|
|
Equipment
|
5,200
|
|
|
Accounts Payable
|
|
2,629
|
|
Unearned Repair Revenue
|
|
1,146
|
|
Common Stock
|
|
5, 000
|
|
Retained Earning
|
|
6,314
|
|
Dividends
|
1,800
|
|
|
Repair Revenue
|
|
12,236
|
|
Wages Expense
|
3,580
|
|
|
Office Cleaning Expense
|
420
|
|
|
|
27,325
|
27,325
|
Evergreen has hired an accountant to prepare financial statements to determine how well his company is doing after three months. Upon examining the accounting records, the account finds tat following items interest:
(a) An inventory of office supplies reveals supplies on hand of $469,
(b) The Prepaid Rent account includes the rent for the first three months plus deposit for April's rent.
(c) Depreciation on the equipment on the equipment for the first three months is $560.
(d) The balance of the Unearned Repair Revenue account represents a 12-Month service contract paid in advance on February 1.
(e) On March 31, accrued wages total $168.
(f) Federal income taxes for the three months are estimated t be $1,250.
Required:
All adjustments affect one balance sheet account and on income statement account. For each of these situations, show the accounts affected, the amount of the adjustment(using a + or - to indicate an increase or decrease) and the balance of the account after the adjustment in the following format.
Balance Sheet Amount, Amount of Adjudtment(+ or -),Balance After Adjustment, Income Statement Account, Amount of Adjustment (+ or -),Balance After Adjustment.
Work Problem 2.
Preparation of a Work Sheet, Financial Statements, and Adjusting and Closing Entries.
At the end of the fiscal year, Siglo Delivery Services, Inc's trial balance appeared as follows
Siglo Delivery Services, Inc
Trial Balance
August 31, 2014
|
Cash
|
10,072
|
|
|
Accounts Receivable
|
29,314
|
|
|
Prepaid Insurance
|
5,340
|
|
|
Delivery Supplies
|
14,700
|
|
|
Office Supplies
|
2,460
|
|
|
Land
|
15,000
|
|
|
Building
|
196,600
|
|
|
Accumulated Depreciation-Building
|
|
53,400
|
|
Truck
|
103,800
|
|
|
Accumulated Depreciation-truck
|
|
30,900
|
|
Office Equipment
|
15,900
|
|
|
Accumulate Depreciation-Office equipment
|
|
10,800
|
|
Account Payable
|
|
9,396
|
|
Unearned Lock Box Fees
|
|
8,340
|
|
Mortgage Payable
|
|
72,00
|
|
Common Stock
|
|
100,000
|
|
Retained Earnings
|
|
28,730
|
|
Dividend
|
30,000
|
283,470
|
|
Delivery Service Revenue
|
|
283,470
|
|
Lockbox Fee Earned
|
|
28,800
|
|
Truck Drivers Wages Express
|
120,600
|
|
|
Office Salary Expense
|
44,400
|
|
|
Gas, Oil, and Truck Repairs Expense
|
31,050
|
|
|
Interest Expense
|
7,200
|
|
|
|
625,836
|
625,836
|
Required
1.Enter the trial balance amount in the Trial Balance columns of a worksheet and complete the worksheet using the information that follows.
(a) Expired insurance,$3, 060.
(b) Inventory of unused delivery supplies, $1, 430
(c) Inventory of unused office supplies $186.
(d) Estimated depreciation on the building, $14,400.
(e) Estimated depreciation on the trucks $15,450.
(f) Estimated depreciation on the office equipment $2,700.
(g) The company credits the lockbox fee of customers who pay in advance to the Unearned Lockbox fees account. Of the amount credit to this account during the year, $5,630 had been earned by August 31,
(h) Lockbox fees earned but unrecorded and uncollected at the end of the account period, $816.
(i) Accrued but unpaid truck drivers wages at the end of the year, $1,920.
2.Prepare an income statement, a statement retained earnings, and a balance sheet for the company.
3. The prepareis adjusting and closing entries from the worksheet
4.Can the work sheet be used as a substitute for the financial statement? Explain your answer.