Problem C Hillside Apartments, Inc., adjusts and closes its books each December
ID: 2444526 • Letter: P
Question
Problem C Hillside Apartments, Inc., adjusts and closes its books each December 31. Assume the accounts for all prior years have been properly adjusted and closed. Following are some of the company’s account balances prior to adjustment on 2010 December 31:
HILLSIDE APARTMENTS, INC. Partial Trial Balance
2010 December 31 debit credit
Prepaid insurance $7,500
Supplies on hand 7,000
Buildings 255,000
Accumulated deprecation – Buildings 96,000
Unearned rent 2,700
Salaries expense 69,000
Rent revenue 277,500
The Prepaid Insurance account balance represents the remaining cost of a four-year insurance policy dated 2011 June 30, having a total premium of USD 12,000.
The physical inventory of the office supply stockroom indicates that the supplies on hand cost USD 3,000.
The building was originally acquired on 1994 January 1, at which time management estimated that the building would last 40 years and have a residual value of USD 15,000.
Salaries earned since the last payday but unpaid at December 31 amount to USD 5,000.
Interest earned but not collected on a savings account during the year amounts to USD 400.
The Unearned Rent account arose through the prepayment of rent by a tenant in the building for 12
months beginning 2010 October 1.
Prepare the annual year-end adjusting entries indicated by the additional data.
Explanation / Answer
9. The adjusted trial balance for The Washington Post Company for the year ended December 31, 2008, is as follows (in alphabetical order). Use the trial balance to prepare the closing entry for the year.
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