1) enter the adjusted balances from the trial balances and post the adjusting en

Question

1) enter the adjusted balances from the trial balances and post the adjusting entries to the T-accounts, and post the closing entries to the T-accounts.

cash

beginning balance:

ending balance:

accounts receivable

beginning balance:

ending balance:

supplies

beginning balance:

ending balance:

prepaid rent

beginning balance:

ending balance:

equipment:

beginning balance:

ending balance:

accumulated depretiation

beginning balance:

ending balance:

beginning balance:

ending balance:

salaries payable

beginning balance:

ending balance:

beginning balance:

ending balance:

interest payable

beginning balance:

ending balance:

beginning balance:

ending balance:

common stock

beginning balance:

ending balance:

beginning balance:

ending balance:

service revenue

beginning balance:

ending balance:

salareis expense

beginning balance:

ending balance:

interest expense

beginning balance:

ending balance:

rent expense

beginning balance:

ending balance:

supplies expense

beginning balance:

ending balance:

beginning balance:

ending balance:

depreciation expense

beginning balance:

ending balance:

2) prepare an adjusted trial balance

3)

a)prepare an income statement for the year end december 31, 2018

b)prepare a statement of shareholders' equity for the year ended December 31, 2018. Assume that no common stock is ussed during the yaer

c)orepare a classified balance sheet for the year ended December 31,2018

cash

beginning balance:

ending balance:

accounts receivable

beginning balance:

ending balance:

supplies

beginning balance:

ending balance:

prepaid rent

beginning balance:

ending balance:

equipment:

beginning balance:

ending balance:

accumulated depretiation

beginning balance:

ending balance:

accounts payable

beginning balance:

ending balance:

salaries payable

beginning balance:

ending balance:

utilities payable

beginning balance:

ending balance:

interest payable

beginning balance:

ending balance:

notes payable

beginning balance:

ending balance:

common stock

beginning balance:

ending balance:

retained earnings

beginning balance:

ending balance:

service revenue

beginning balance:

ending balance:

salareis expense

beginning balance:

ending balance:

interest expense

beginning balance:

ending balance:

Crimson Tide Music Academy offers lessons in playing a wide range of musical instruments. The unadjusted trial balance as of December 31, 2018, appears belovw December 31 is the company's fiscal year-end. Accounts Cash Accounts Debits Credits $10,300 9,500 2,000 7,200 90,000 Receivable Supplies Prepaid Rent Equipment Accumulated $ 12,000 Depreciation Accounts 7,700 0 0 0 20,000 45,000 Payable Salaries Payable Interest Payable Utilities Payable Notes Payable Common Stock Retained 19,000 Earnings Service Revenue Salaries Expense Interest Expense Rent Expense Supplies 42,200 24,500 0 0 0 Expense Utilities Expense 2,400 Depreciation 0 Expense Totals $145,900 $145,900 Information necessary to prepare the year-end adjusting entries appears below a. Depreciation of equipment for the year is $6,000 b. Accrued salaries at year-end should be $2,100 C. Crimson Tide borrows $20,000 on September 1, 2018. The principal is due to be repaid in four years. Interest is payable each August 31 at an annual rate of 12%. d. Unused supplies at year-end total $700. Crimson Tide debits Supplies at the time supplies are purchased. e. Crimson Tide opens a second studio by paying for one year of rent in advance on April 1, 2018, for $7,200 ($600 per month) debiting Prepaid Rent. f. Unpaid utilities for December total $200.

Explanation / Answer

Adjusting entries a Depreciation expense 6000           Accumulated depreciation equipment 6000 b Salaries expense 2100            Salaries payable 2100 c Interest expense 800 (20000*12%*4/12)            Interest payable 800 d Supplies expense 1300 (2000-700)            Supplies 1300 e Rent expense 5400 (600*9)                 Prepaid rent 5400 f Utilities expense 200              Utilities payable 200 Adjusted trial balance Debit Credit Cash 10300 Accounts receivable 9500 Supplies 700 Prepaid rent 1800 Equipment 90000 Accumlated depreciation equipment 18000 Accounts payable 7700 Salaries payable 2100 Interest payable 800 Utilities payable 200 Notes payable 20000 Common stock 45000 Retained earnings 19000 Service revenue 42200 Salaries expense 26600 Interest expense 800 Rent expense 5400 Supplies expense 1300 Utilities expense 2600 Depreciation expense 6000 Total 155000 155000 Income statement Service revenue 42200 Expense Salaries expense 26600 Interest expense 800 Rent expense 5400 Supplies expense 1300 Utilities expense 2600 Depreciation expense 6000 Total expense 42700 Net loss -500 4 Shareholders equity statement Common stock retained earnings Beginning 45000 19000 Net loss -500 Dividend 0 0 Ending 45000 18500 Classified balance sheet Assets Current assets Cash 10300 Accounts receivable 9500 Supplies 700 Prepaid rent 1800 Total current assets 22300 Plant property and equipment Equipment 90000 Accumlated depreciation equipment -18000 72000 Total assets 94300 Liabilities and stockholders equity Current liabilities Accounts payable 7700 Salaries payable 2100 Interest payable 800 Utilities payable 200 Total current liabilities 10800 Notes payable 20000 Total liabilities 30800 Stockholders equity Common stock 45000 Retained earnings 18500 Total stockholders equity 63500 Total liabilities and stockholders equity 94300

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