Exercise 1: The account balances appearing on the trial balance were taken from the general ledger of ABC Company at January 31. Additional information for January which has not yet been recorded in the accounts is as follows:
a. Depreciation on equipment for January was $1,200.
b. The amount of insurance that expired in January was $700.
c. Rent owed on ABC Company for January was $1,800 but will not be paid until February.
d. A physical count of supplies indicates $1,750 on hand at January 31st.
e. Salaries owed on ABC Company for January was $2,700 but will not be paid until February.
f. A utility bill for $150 has not been recorded and will not be paid until next month.
g. $2,800 of unearned service revenue is recognized for services performed during the month.
h. Invoices representing $1,200 of services performed during the month have not been recorded as of June 30.
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Accounts
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Trial Balance
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Debit
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Credit
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Cash
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12,500
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Supplies
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2,750
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Prepaid insurance
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5,500
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Equipment
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60,000
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Accumulated Depreciation
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11,250
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Accounts payable
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6,000
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Notes payable
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10,000
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Owner capital
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48,250
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Owners' drawings
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6,000
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Copy revenue
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12,250
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Utilities expense
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1,000
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Total
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87,750
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87,750
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Required:
(a) Prepare the necessary adjusting entries for January.
(b) Prepare the adjusted trial balance for the month ended January 31.
Exercise 2: The adjusted trial balance of YWZ Company on December 31, 2017 includes the following accounts:
Accumulated Depreciation, $8,000;
Depreciation Expense, $2,500;
Note Payable $6,500;
Interest Expense $250;
Utilities Expense, $350;
Rent Expense, $820;
Service Revenue, $22,600;
Salaries Expense, $6,000;
Supplies, $300;
Supplies Expense, $1,800;
Wages Payable, $700.
Required: Prepare an income statement for the month of December.
Exercise 3: The trial balance columns of the worksheet for Lamar Company at June 30, 2017,are as follows.
LAMAR COMPANY Worksheet for the Month Ended June 30, 2017
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Trial Balance
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Account Titles
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Debit
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Credit
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Cash
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2,760
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Accounts Receivable
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3,100
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Supplies
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1,320
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Accounts Payable
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$2,080
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Unearned Service Revenue
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360
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Owner's Capital
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2,480
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Service Revenue
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3,100
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Salaries and Wages Expense
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700
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Miscellaneous Expense
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140
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Total
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8,020
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8,020
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Other data:
1. A physical count reveals $450 of supplies on hand.
2. $220 of the unearned revenue is still unearned at month-end.
3. Accrued salaries are $350.
Required: Enter the trial balance on a worksheet and complete the worksheet.