Following is the unadjusted trial balance for Sun Energy Co. on December 31, 2017. Sun Energy Co. Unadjusted Trial Balance Year Ended December 31, 2017 Account Debit Credit Cash $5,000 Accounts Receivable 3,300 Merchandise Inventory 4,500 Buildings 2,400 Equipment 3,200 Accounts Payable $5,700 Salaries Payable 3,500 Common Stock 2,500 Dividends Sales Revenue 14,000 COGS 3,800 Salaries Expense 3,500 Totals $25,700 $25,700 You are also given the following supplemental information: • A pending lawsuit, claiming $2,500 in damages, is considered likely to favor the plaintiff and can be reasonably estimated. Sun Energy Co. believes a customer may win a lawsuit for $3,500 in damages, but the outcome is only reasonably possible to occur. Sun Energy calculated warranty expense estimates of $210.

Question
Following is the unadjusted trial balance for Sun Energy Co. on December 31, 2017.
Sun Energy Co.
Unadjusted Trial Balance
Year Ended December 31, 2017
Account
Debit
Credit
Cash
$5,000
Accounts Receivable
3,300
Merchandise Inventory
4,500
Buildings
2,400
Equipment
3,200
Accounts Payable
$5,700
Salaries Payable
3,500
Common Stock
2,500
Dividends
Sales Revenue
14,000
COGS
3,800
Salaries Expense
3,500
Totals
$25,700
$25,700
You are also given the following supplemental information:
• A pending lawsuit, claiming $2,500 in damages, is considered likely to favor the plaintiff and can be reasonably estimated. Sun Energy Co. believes a customer may win a lawsuit for $3,500 in
damages, but the outcome is only reasonably possible to occur. Sun Energy calculated warranty expense estimates of $210.
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Transcribed Image Text

Following is the unadjusted trial balance for Sun Energy Co. on December 31, 2017. Sun Energy Co. Unadjusted Trial Balance Year Ended December 31, 2017 Account Debit Credit Cash $5,000 Accounts Receivable 3,300 Merchandise Inventory 4,500 Buildings 2,400 Equipment 3,200 Accounts Payable $5,700 Salaries Payable 3,500 Common Stock 2,500 Dividends Sales Revenue 14,000 COGS 3,800 Salaries Expense 3,500 Totals $25,700 $25,700 You are also given the following supplemental information: • A pending lawsuit, claiming $2,500 in damages, is considered likely to favor the plaintiff and can be reasonably estimated. Sun Energy Co. believes a customer may win a lawsuit for $3,500 in damages, but the outcome is only reasonably possible to occur. Sun Energy calculated warranty expense estimates of $210.

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