Milbank Repairs & Service, an electronics repair store, prepared the following unadjustedtrial balance at the end of its first year of operationsMilbank Repairs & ServiceUnadjusted Trial BalanceJune 30, 2019DebitCreditBalancesBalancesCash10,35067,50016,200Accounts Receivable.Supplies..Equipment....Accounts PayableUnearned Fees166,10015,75018,000Nancy Townes, CapitalNancy Townes, DrawingFees Earned...171,50013,500294,750Wages ExpenseRent ExpenseUtilities ExpenseMiscellaneous Expense94,50072,00051,7508,100500,000500,000For preparing the adjusting entries, the following data were assembled:Fees earned but unbilled on June 30 were $7,380.Supplies on hand on June 30 were $2,775.Depreciation of equipment was estimated to be $11,000 for the yearThe balance in unearned fees represented the June 1 receipt in advance for servicesto be provided. During June, $16,500 of the services were provided.Unpaid wages accrued on June 30 were $3,880.Instructions1. Journalize the adjusting entries necessary on June 30, 2019.2. Determine the revenues, expenses, and net income of Milbank Repairs & Service beforethe adjusting entries.3. Determine the revenues, expenses, and net income of Milbank Repairs & Service afterthe adjusting entries4. Determine the effect of the adjusting entries on Nancy Townes, Capital

Question
Asked Dec 4, 2019
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Milbank Repairs & Service, an electronics repair store, prepared the following unadjusted
trial balance at the end of its first year of operations
Milbank Repairs & Service
Unadjusted Trial Balance
June 30, 2019
Debit
Credit
Balances
Balances
Cash
10,350
67,500
16,200
Accounts Receivable.
Supplies..
Equipment....
Accounts Payable
Unearned Fees
166,100
15,750
18,000
Nancy Townes, Capital
Nancy Townes, Drawing
Fees Earned...
171,500
13,500
294,750
Wages Expense
Rent Expense
Utilities Expense
Miscellaneous Expense
94,500
72,000
51,750
8,100
500,000
500,000
For preparing the adjusting entries, the following data were assembled:
Fees earned but unbilled on June 30 were $7,380.
Supplies on hand on June 30 were $2,775.
Depreciation of equipment was estimated to be $11,000 for the year
The balance in unearned fees represented the June 1 receipt in advance for services
to be provided. During June, $16,500 of the services were provided.
Unpaid wages accrued on June 30 were $3,880.
Instructions
1. Journalize the adjusting entries necessary on June 30, 2019.
2. Determine the revenues, expenses, and net income of Milbank Repairs & Service before
the adjusting entries.
3. Determine the revenues, expenses, and net income of Milbank Repairs & Service after
the adjusting entries
4. Determine the effect of the adjusting entries on Nancy Townes, Capital
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Milbank Repairs & Service, an electronics repair store, prepared the following unadjusted trial balance at the end of its first year of operations Milbank Repairs & Service Unadjusted Trial Balance June 30, 2019 Debit Credit Balances Balances Cash 10,350 67,500 16,200 Accounts Receivable. Supplies.. Equipment.... Accounts Payable Unearned Fees 166,100 15,750 18,000 Nancy Townes, Capital Nancy Townes, Drawing Fees Earned... 171,500 13,500 294,750 Wages Expense Rent Expense Utilities Expense Miscellaneous Expense 94,500 72,000 51,750 8,100 500,000 500,000 For preparing the adjusting entries, the following data were assembled: Fees earned but unbilled on June 30 were $7,380. Supplies on hand on June 30 were $2,775. Depreciation of equipment was estimated to be $11,000 for the year The balance in unearned fees represented the June 1 receipt in advance for services to be provided. During June, $16,500 of the services were provided. Unpaid wages accrued on June 30 were $3,880. Instructions 1. Journalize the adjusting entries necessary on June 30, 2019. 2. Determine the revenues, expenses, and net income of Milbank Repairs & Service before the adjusting entries. 3. Determine the revenues, expenses, and net income of Milbank Repairs & Service after the adjusting entries 4. Determine the effect of the adjusting entries on Nancy Townes, Capital

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Expert Answer

Step 1

1.

Journalize the adjusting entry necessary on June 30, 2019.

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The following entry shows the adjusting entry for accrued fees unearned on June 30. Credit (S) Debit Date Account Titles and Explanation ($) June Accounts Receivable 30 7,380 Fees earned 7,380 (To record the accounts receivable at the end of the year.) The following entry shows the adjusting entry for supplies on June 30. Debit Credit Date Account Titles and Explanation (S) (S) June Supplies Expense (1) 13,425 30 Supplies 13,425 (To record the supplies expense at the end of the accounting period) Calculate supplies expense for the year. Amount of supplies before adjustment $16,200 $2,775 $13,425 Supplies expense Amount of supplies for the year on hand

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Step 2

 Adjusting entry continued...

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The adjusting entry for recording depreciation is as follows: Debit Credit Date Account Titles and Explanation (S) ($) June Depreciation expense 11,000 30 11,000 Accumulated Depreciation (To record the depreciation on office equipment for the current year.) The following entry shows the adjusting entry for unearned fees on June 30. Credit Debit Account Titles and Explanation Date (S) (S) June Unearned Fees 16,500 30 16,500 Fees earned (To record the fees earned from services at the end of the accounting period.) The following entry shows the adjusting entry for wages expense on June 30. Debit Credit Account Titles and Explanation Date ($) ($) June 3,880 Wages expenses 30 3,880 Wages Payable (To record the wages accrued but not paid at the end of the accounting period.)

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Step 3
  1.  

Determine the revenues, expenses, and net income of M Repairs &a...

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The revenues, expenses and net income before adjusting entries of M Repairs and Services are stated below: Revenue $294,750 (given) Expenses $226,350 (W.N-1) Net income $68,400 (W.N-2) Working Notes: W.N-1 Calculation of expenses before adjusting entries: Wages expense + Rent expense Utilities Expense +Miscellaneous expense, =($94,500+ $72,000 +$5,1750+ $8,100) Expenses - $226,350 W.N-2 Calculation of net income before adjusting entries Net income= (Revenue - Expenses $294,750- $226,350 $68.400

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