Use the following transaction descriptions and the spreadsheet with the unadjust
ID: 2584890 • Letter: U
Question
Use the following transaction descriptions and the spreadsheet with the unadjusted trial balance to compose the following items:
Widget Co. Unadjusted Trial Balance Debit Credit 4,500 2,200 Cash Accounts Receivable Allowance for Doubtful Accounts Inventory Interest Receivable Note Receivable Equipment Accumulated Depreciation Accounts Payable Sales Tax Payable Interest Payable Bond Pavable Common Stock Sales Revenue Sales Discounts & Returns Cost of Goods Sold Advertising Expense Bad Debt Expense Depreciation Expense Office Supplies Expense Rent Expense Wages Expense Interest Income Interest Expense Total 220 600 0 3,000 4,000 0 1,800 380 0 5,000 5,000 10,000 450 4,500 600 0 0 350 1,200 1,000 0 0 22,400 22,400Explanation / Answer
Adjustment Journal entries
date
explanation
debit
credit
1-
depreciation expense
1400
accumulated depreciation
1400
2-
bad debts expense
47.75
allowance for doubtful debts
47.75
3-
interest receivable
60
interest income
60
4-
interest expense
75
interest payable
75
Adjusted trial balance
explanation
debit
credit
cash
4500
accounts receivables
2200
allowance for doubtful accounts
267.75
inventory
600
interest receivable
60
notes receivables
3000
equipment
4000
accumulated depreciation
1400
accounts payable
1800
sales tax payable
380
interest payable
75
bonds payable
5000
common stock
5000
sales revenue
10000
sales discount and returns
450
cost of goods sold
4500
advertising
600
bad debts
47.75
depreciation expense
1400
office supplies expense
350
rent expense
1200
wage expense
1000
interest income
60
interest expense
75
total
23982.75
23982.75
income statement
Explanation
Amount
sales revenue
10000
less sales return and discount
450
net sales revenue
9550
less cost of goods sold
4500
gross profit
5050
operating expense
4597.75
advertising
600
bad debts
47.75
depreciation expense
1400
office supplies expense
350
rent expense
1200
wage expense
1000
operating profit
452.25
add interest income
60
less interest expense
-75
net income/loss
437.25
Balance sheet
Assets
current assets
cash
4500
accounts receivables net of doubtful debts
1932.25
inventory
600
interest receivable
60
notes receivables
3000
total of current assets
10092.25
equipment net of accumulated depreciation
2600
totalof assets
12692.25
Liabilities and shareholders equity
Liabilities and shareholders equity
current liabilties
accounts payable
1800
sales tax payable
380
interest payable
75
total of current liabilities
2255
bonds payable
5000
total of liabilities
7255
share holders equity
5437.25
common stock
5000
retained earnings
437.25
total of liabilities and shareholders equity
12692.25
statement of retained earning
retained earnings
437.25
Adjustment Journal entries
date
explanation
debit
credit
1-
depreciation expense
1400
accumulated depreciation
1400
2-
bad debts expense
47.75
allowance for doubtful debts
47.75
3-
interest receivable
60
interest income
60
4-
interest expense
75
interest payable
75
Adjusted trial balance
explanation
debit
credit
cash
4500
accounts receivables
2200
allowance for doubtful accounts
267.75
inventory
600
interest receivable
60
notes receivables
3000
equipment
4000
accumulated depreciation
1400
accounts payable
1800
sales tax payable
380
interest payable
75
bonds payable
5000
common stock
5000
sales revenue
10000
sales discount and returns
450
cost of goods sold
4500
advertising
600
bad debts
47.75
depreciation expense
1400
office supplies expense
350
rent expense
1200
wage expense
1000
interest income
60
interest expense
75
total
23982.75
23982.75
income statement
Explanation
Amount
sales revenue
10000
less sales return and discount
450
net sales revenue
9550
less cost of goods sold
4500
gross profit
5050
operating expense
4597.75
advertising
600
bad debts
47.75
depreciation expense
1400
office supplies expense
350
rent expense
1200
wage expense
1000
operating profit
452.25
add interest income
60
less interest expense
-75
net income/loss
437.25
Balance sheet
Assets
current assets
cash
4500
accounts receivables net of doubtful debts
1932.25
inventory
600
interest receivable
60
notes receivables
3000
total of current assets
10092.25
equipment net of accumulated depreciation
2600
totalof assets
12692.25
Liabilities and shareholders equity
Liabilities and shareholders equity
current liabilties
accounts payable
1800
sales tax payable
380
interest payable
75
total of current liabilities
2255
bonds payable
5000
total of liabilities
7255
share holders equity
5437.25
common stock
5000
retained earnings
437.25
total of liabilities and shareholders equity
12692.25
statement of retained earning
retained earnings
437.25
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