Assignment
Tunstall, Inc., a small service company, keeps its records without the help of an accountant. After much effort, an outside accountant prepared the following unadjusted trial balance as of the end of the annual accounting period, December 31, 2014:
|
Account Titles
|
Debit
|
Credit
|
|
Cash
|
$ 46,200
|
|
|
Accounts receivable
|
11,200
|
|
|
Supplies
|
590
|
|
|
Prepaid insurance
|
630
|
|
|
Service trucks
|
16,900
|
|
|
Accumulated depreciation
|
|
$ 9,100
|
|
Other assets
|
9,260
|
|
|
Accounts payable
|
|
2,240
|
|
Wages payable
|
|
|
|
Income taxes payable
|
|
|
|
Note payable (3
|
|
13,000
|
|
Common stock (4,100 shares outstanding)
|
|
2,026
|
|
Additional paid-in capital
|
|
18,234
|
|
Retained earnings
|
|
4,800
|
|
Service revenue
|
|
68,670
|
|
Remaining expenses (not detailed; excludes income tax)
|
33,290
|
|
|
Income tax expense
|
|
|
|
Totals
|
$ 118,070
|
$ 118,070
|
Data not yet recorded at December 31, 2014, included:
a. The supplies count on December 31, 2014, reflected $300 remaining supplies on hand to be used in 2015.
b. Insurance expired during 2014, $800.
c. Depreciation expense for 2014, $3,700.
d. Wages earned by employees not yet paid on December 31, 2014, $640.
e. Income tax expense, $5,540.
Required:
1 Record the 2014 adjusting entries.
2-a. Prepare an income statement that includes the effects of the preceding five transactions.
2-b. Prepare a classified balance sheet that includes the effects of the preceding five transactions.
3 Record the 2014 closing entry.