T accounts, adjusting entries, financial statements, and closing entries; optional end-of-period spreadsheet
The unadjusted trial balance of La Mesa Laundry at August 31, 2019, the end of the fiscal year, follows:
La Mesa Laundry Unadjusted Trial Balance August 31,2019 |
||
Debit Balances |
Credit Balances | |
Cash | 3,800 | |
Laundry Supplies | 9,000 | |
Prepaid Insurance | 6,000 | |
Laundry Equipment | 180,800 | |
Accumulated Depreciation | 49,200 | |
Accounts Payable | 7,800 | |
Bobbi Downey. Capital | 95,000 | |
Bobbi Downey. Drawing | 2,400 | |
Laundry Revenue | 248,000 | |
Wages Expense | 135,800 | |
Rent Expense | 43,200 | |
Utilities Expense | 16,000 | |
Miscellaneous Expense | 3,000 | |
400,000 | 400,000 |
The data needed to determine year-end adjustments are as follows:
a. Wages accrued but not paid at August 31 are $2,200.
b. Depreciation of equipment during the year is $8,150.
c. Laundry supplies on hand at August 31 are $2,000.
d. Insurance premiums expired during the year are $5,300.
Instructions
1. For each account listed in the unadjusted trial balance, enter the balance in a T account. Identity the balance as "Aug. 31 Bal." In addition, add T accounts for Wages Payable, Depreciation Expense, Laundry Supplies Expense, and Insurance Expense.
2. (Optional) Enter the unadjusted trial balance on an end-of-period spreadsheet and complete the spreadsheet. Add the accounts listed in part (1) as needed.
3. Journalize and post the adjusting entries. Identity the adjustments as "Adj." and the new balances as "Adj. Bal."
4. Prepare an adjusted trial balance.
5. Prepare an income statement, a statement of owner's equity (no additional investments were made during the year), and a balance sheet.
6. Journalize and post the closing entries. Identify the closing entries as "Clos."
7. Prepare a post-closing trial balance.
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