Bravo Unlimited Unadjusted Trial Balance December 31, 2016 Account Title Debit C

Question

Bravo Unlimited

Unadjusted Trial Balance

December 31, 2016

Account Title

Debit

Credit

Cash $88,450

Accounts Receivable 331,860

Supplies 6,255

Prepaid Rent 11,000

Equipment 295,285

Accumulated Depreciation $224,260

Accounts Payable 72,555

Wages Payable 0

Capital Stock 220,000

Retained Earnings 111,145

Service Revenue 893,105

Interest Income 1,500

Rent Expense 60,500

Wages Expense 527,260

Supplies Expense 42,520

Utilities Expense 8,595

Depreciation Expense 144,000

Interest Expense 6,840

________

Totals

$1,522,565

$1,522,565

Adjusting Items:

2. The prepaid rent covers December 2016 and January 2017 rents.
3. December depreciation on equipment is $12,000 per month.
4. At year end Wages of $10,300 were earned but unpaid.

use this info to determine unadjusted account balances for the following: cash, prepaid rent, equipment, accumulated depreciation, wages payable, rent expense, depreciation expense

Explanation / Answer

Adjusted account balances calculation:

No adjusting entries for cash, cash balance= 88450

Prepaid rent 11000 cosists of rent for Dec16 and Jan17, so expense for Dec= 11000*1/2= 5500

Hence add rent expense 5500, adjusted rent expense balance= 60500+5500= 66000

Reduce prepaid rent by 5500, adjsted prepaid rent balance= 11000-5500= 5500

Depreciation on equipment= 12000, increased depreciation expense to= 144000+12000= 156000

Increased accummulated depreciation to= 224260+12000= 236260

Wages earned unpaid of 10300 increases wage expense to= 527260+10300= 537560

and wages payable balance to = 0+10300= 10300

Equipment balance will not change, hence balance= 295285

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