Problem - The trial balances before and after adjustment for Garcia Company at the end of its fiscal year are presented below.
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GARCIA COMPANY Trial Balance August 31, 2011
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Before Adjustment
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After Adjustment
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Dr.
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Cr.
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Dr.
|
Cr.
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Cash
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$10,400
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$10,400
|
|
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Accounts Receivable
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8,800
|
|
9,800
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|
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Office Supplies
|
2,300
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|
700
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|
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Prepaid Insurance
|
4,000
|
|
2,500
|
|
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Office Equipment
|
14,000
|
|
14,000
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|
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Accumulated Depreciation-Office Equipment
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$3,600
|
|
$4,500
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Accounts Payable
|
|
5,800
|
|
5,800
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Salaries Payable
|
|
-0-
|
|
1,100
|
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Unearned Rent Revenue
|
|
1,500
|
|
600
|
|
Common Stock
|
|
10,000
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|
10,000
|
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Retained Earnings
|
|
5,600
|
|
5,600
|
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Service Revenue
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34,000
|
|
35,000
|
|
Rent Revenue
|
|
11,000
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|
11,900
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|
Salaries Expense
|
17,000
|
|
18,100
|
|
|
Office Supplies Expense
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-0-
|
|
1,600
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|
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Rent Expense
|
15,000
|
|
15,000
|
|
|
Insurance Expense
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-0-
|
|
1,500
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|
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Depreciation Expense
|
-0-
|
|
900
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|
|
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$71,500
|
$71,500
|
$74,500
|
$74,500
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Prepare the income statement and a retained earnings statement for the year and the balance sheet at August 31.