Concept explainers
Problem 4-5B Preparing trial balances, closing entries, and financial statements C3 P2 P3
Santo Company's adjusted
Required
1. Prepare an income statement and a statement of owner's equity for the year and a classified balance sheet at December 31. Note: Die P. Santo.
Capital account balance was $35.650 on December 31 of the prior year.
Check (1) Ending capital balance, $39,590
2. Enter the adjusted trial balance in the first two columns of a six-column table. Use the middle two columns for closing entry information and the last
two columns for a post-closing trial balance. Insert an Income Summary account (No. 301) as the last item in the trial balance.
(2)P-C trial balance totals, $51,790
3. Enter closing entry information in the sk-column table and prepare
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FUND. ACCOUNTING PRINCIPLES >CUSTOM<
- Financial statements and closing entries The Gorman Group is a financial planning services firm owned and operated by Nicole Gorman. A% of October 31, 20Y9, the end of the fiscal year, the accountant for The Gorman Group prepared an end-of-period spreadsheet, part of which follows: Instructions 1. Prepare an income statement, a statement of stockholders' equity, and a balance sheet. During the year, no additional common stock was issued. 2. Journalize the entries that were required to dose the accounts at October 31. 3. If the balance of Retained Earnings had instead increased 113,000 after the closing entries were posted, and the dividends remained the same, what would have been the amount of net income or net loss?arrow_forwardLedger accounts, adjusting entries, financial statements, and closing entries; optional end-of-period spreadsheet The unadjusted trial balance of Recessive Interiors at January 31, 2016, the end of the year, follows: The data needed to determine year-end adjustments are as follows: a. Supplies on hand at January 31 are 2,850. b. Insurance premiums expired during the year are 3,150. c. Depreciation of equipment during the year is 5,250. d. Depreciation of trucks during the year is 4,000. e. Wages accrued but not paid at January 31 are 900. Instructions 1. For each account listed in the unadjusted trial balance, enter the balance in the appropriate Balance column of a four-column account and place a check mark () in the Posting Reference column. 2. (Optional) Enter the unadjusted trial balance on an end-of-period spreadsheet and complete the spreadsheet. Add the accounts listed in part (3) as needed. 3. Journalize and post the adjusting entries, inserting balances in the accounts affected. Record the adjusting entries on Page 26 of the journal. The following additional accounts from Recessive Interiors chart of accounts should be used: Wages Payable, 22; Depreciation ExpenseEquipment, 54; Supplies Expense, 55; Depreciation ExpenseTrucks, 56; Insurance Expense, 57. 4. Prepare an adjusted trial balance. 5. Prepare an income statement, a statement of owners equity (no additional investments were made during the year), and a balance sheet. 6. Journalize and post the closing entries. Record the closing entries on Page 27 of the journal. (Income Summary is account #33 in the chart of accounts.) Indicate closed accounts by inserting a line in both Balance columns opposite the closing entry. 7. Prepare a post-closing trial balance.arrow_forwardClosing entries with net income After all revenue and expense accounts have been closed at the end of t he fiscal year, Income Summary has a debit of 2,450,000 and a credit of 3,000,000. At the same date, Retained Earnings has a credit balance of 8,222,600 and Dividends has a balance of 125,000. (A) Journalize the entries required to complete the closing of the accounts. (B) Determine the amount of Retained. Earnings at me end of the period.arrow_forward
- 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, 2016, the end of the fiscal year, follows: La Mesa Laundry Unadjusted Trial Balance August 31,2016 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 Common Stock................. 15,000 Retained Earnings.............. 80,000 Dividends..................... 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. Identify the balance as Aug. 31 Bal. In addition, add T accounts for Wages Payable, Depreciation Expense, Laundry Supplies Expense, Insurance Expense, and Income Summary. 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. Identify the adjustments by Adj." and the new balances as Adj. BAL." 4. Prepare an adjusted trial balance. 5. Prepare an income statement, a retained earnings statement, and a balance sheet. 6. Journalize and post the closing entries. Identify the closing entries by Clos." 7. Prepare a post-closing trial balance.arrow_forwardAdjusting entries and errors At the end of April, the first month of operations, the following selected data were taken from the financial statements of Shelby Crawford, an attorney: Net income for April 120,000 Total assets at April 30 750,000 Total liabilities at April 30 300,000 Total owner's equity at April 30 450,000 In preparing the financial statements, adjustments for the following data were overlooked: Supplies used during April, 2,750. Unbilled fees earned at April 30, 23,700. Depreciation of equipment for April, 1,800. Accrued wages at April 30, 1,400. Instructions 1. Journalize the entries to record the omitted adjustments. 2. Determine the correct amount of net income for April and the total assets, liabilities, and owner's equity at April 30. In addition to indicating the corrected amounts, indicate the effect of each omitted adjustment by setting up and completing a columnar table similar to the following. The adjustment for supplies used is presented as an example.arrow_forwardLedger accounts, adjusting entries, financial statements, and closing entries; optional spreadsheet The unadjusted trial balance of Lakota Freight Co. at March 31, 2018, the end of the year, follows: Lakota Freight Co. Unadjusted Trial Balance March 31, 2018 Account No. Debit Balances Credit Balances Cash................................................ 11 12,000 Supplies............................................ 13 30,000 Prepaid Insurance.................................... 14 3,600 Equipment.......................................... 16 110,000 Accumulated DepreciationEquipment............... 17 25,000 Trucks............................................... 18 60,000 Accumulated DepreciationTrucks................... 19 15,000 Accounts Payable.................................... 21 4,000 Common Stock...................................... 31 26,000 Retained Earnings................................... 32 70,000 Dividends........................................... 33 15,000 Service Revenue..................................... 41 160,000 Wages Expense...................................... 51 45,000 Rent Expense........................................ 53 10,600 Truck Expense....................................... 54 9,000 Miscellaneous Expense............................... 59 4,800 300,000 300,000 The data needed to determine year-end adjustments are as follows: (A) Supplies on hand at March 31 are 7,500. (B) Insurance premiums expired during year are 1,800. (C) Depreciation of equipment during year is 8,350. (D) Depreciation of trucks during year is 6,200. (E) Wages accrued but not paid at March 31 are 600. Instructions 1. For each account listed in the trial balance, enter the balance in the appropriate Balance column of a four-column account and place a check mark () in the Posting Reference column. 2. (Optional) Enter the unadjusted trial balance on an end-of-period spread sheet and complete the spreadsheet. Add the accounts listed in part (3) as needed. 3. Journalize and post the adjusting entries, inserting balances in the accounts affected. Record the adjusting entries on Page 26 of the journal. The following additional accounts from Lakota Freight Co.s chart of accounts should be used: Wages Payable, 22; Supplies Expense, 52; Depreciation ExpenseEquipment, 55; Depreciation ExpenseTrucks, 56; Insurance Expense, 57. 4. Prepare an adjusted trial balance. 5. Prepare an income statement, a retained earnings statement, and a balance sheet. 6. Journalize and post the closing entries. Record the closing entries on Page 27 of the journal. (Income Summary is account #34 in the chart of accounts.) Indicate closed accounts by inserting a line in both Balance columns opposite the closing entry. 7. Prepare a post-closing trial balance.arrow_forward
- 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.arrow_forwardT accounts, adjusting entries, financial statements, and closing entries; optional end-of-period spreadsheet The unadjusted trial balance of Epicenter Laundry at June 30, 2016, the end of the fiscal year, follows: The data needed to determine year-end adjustments are as follows: a. Laundry supplies on hand at June 30 are 3,600. b. Insurance premiums expired during the year are 5,700. c. Depreciation of laundry equipment during the year is 6,500. d. Wages accrued but not paid at June 30 are 1,100. Instructions 1. For each account listed in the unadjusted trial balance, enter the balance in a T account. Identify the balance as "June 30 Bal." In addition, add T accounts for Wages Payable, Depreciation Expense, Laundry Supplies Expense, Insurance Expense, and Income Summary. 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. Identify the adjustments by "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 by Clos. 7. Prepare a post-closing trial balance.arrow_forward
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