Problem 3-8 BRIDGEPORT ADVERTISING TRIAL BALANCE DECEMBER 31, 2017 Unadjusted Ad

Question

Problem 3-8

BRIDGEPORT ADVERTISING
TRIAL BALANCE
DECEMBER 31, 2017

Unadjusted

Adjusted

Dr.

Cr.

Dr.

Cr.

$148,820

$148,820

$158,950

$158,950

No.

Date

Account Titles and Explanation

Debit

Credit

(To record accrued service revenue)

(To record supplies used)

(To expired insurance)

(To record depreciation on equiment)

(To record interest accrued on the note)

(To record service revenue earned)

(To record accrued wages)

Assets

Liabilities and Stockholders’ Equity

%

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Problem 3-8

Bridgeport Advertising was founded by Murali Vedula in January 2015. Presented below are both the adjusted and unadjusted trial balances as of December 31, 2017.

BRIDGEPORT ADVERTISING
TRIAL BALANCE
DECEMBER 31, 2017

Unadjusted

Adjusted

Dr.

Cr.

Dr.

Cr.

Cash $16,740 $16,740 Accounts Receivable 19,170 23,012 Supplies 9,760 6,845 Prepaid Insurance 4,220 2,625 Equipment 64,700 64,700 Accumulated Depreciation-Equipment $24,120 $29,050 Notes Payable 8,600 8,600 Accounts Payable 1,890 1,890 Interest Payable 0 602 Unearned Service Revenue 5,350 3,405 Salaries and Wages Payable 0 756 Common Stock 19,220 19,220 Retained Earnings 27,247 27,247 Dividends 19,300 19,300 Service Revenue 62,393 68,180 Salaries and Wages Expense 9,400 10,156 Insurance Expense 1,595 Interest Expense 602 Depreciation Expense 4,930 Supplies Expense 2,915 Rent Expense 5,530 5,530

$148,820

$148,820

$158,950

$158,950

Journalize the annual adjusting entries that were made. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

No.

Date

Account Titles and Explanation

Debit

Credit

1. Dec. 31

(To record accrued service revenue)

2. Dec. 31

(To record supplies used)

3. Dec. 31

(To expired insurance)

4. Dec. 31

(To record depreciation on equiment)

5. Dec. 31

(To record interest accrued on the note)

6. Dec. 31

(To record service revenue earned)

7. Dec. 31

(To record accrued wages)

Prepare an income statement for the year ended December 31. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
BRIDGEPORT ADVERTISING
Income Statement

December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017

DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues

$

DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues

$

    Dividends    Expenses    Net Income / (Loss)    Retained Earnings, Janaury 1    Retained Earnings, December 31    Revenues    Total Expenses    Total Revenues    

DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues

$

Prepare a retained earnings statement for the year ended December 31. (List items that increase retained earnings first.)
BRIDGEPORT ADVERTISING
Retained Earnings Statement

December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017

DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues

$

AddLess

:

DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues

AddLess

:

DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues

DividendsExpensesNet Income / (Loss)Retained Earnings, Janaury 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues

$

Prepare a classified balance sheet at December 31. (List current assets in order of liquidity.)
BRIDGEPORT ADVERTISING
Balance Sheet

December 31, 2017For the Year Ended December 31, 2017For the Quarter Ended December 31, 2017

Assets

Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' Equity

$

    Current Assets    Current Liabilities    Intangible Assets    Liabilities    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Stockholders’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Stockholders’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Stockholders' Equity    

$

    Add    Less    

:

    Current Assets    Current Liabilities    Intangible Assets    Liabilities    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Stockholders’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Stockholders’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Stockholders' Equity    

$

Liabilities and Stockholders’ Equity

Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' Equity

$

    Current Assets    Current Liabilities    Intangible Assets    Liabilities    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Stockholders’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Stockholders’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Stockholders' Equity    

$

Current AssetsCurrent LiabilitiesIntangible AssetsLiabilitiesLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentStockholders’ EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders’ EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' Equity

    Current Assets    Current Liabilities    Intangible Assets    Liabilities    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Stockholders’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Stockholders’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Stockholders' Equity    

    Current Assets    Current Liabilities    Intangible Assets    Liabilities    Long-term Investments    Long-term Liabilities    Property, Plant and Equipment    Stockholders’ Equity    Total Assets    Total Current Assets    Total Current Liabilities    Total Intangible Assets    Total Liabilities    Total Liabilities and Stockholders’ Equity    Total Long-term Investments    Total Long-term Liabilities    Total Property, Plant and Equipment    Total Stockholders' Equity    

$

Identify which accounts should be closed on December 31.
1.

Rent Revenue Salaries and Wages Payable Notes Payable Insurance Expense Interest Payable Accounts Receivable Supplies Dividends Utilities Expenses Interest Expense Service Revenue Rent Expense Depreciation Expense Prepaid RentSalaries and Wages Expense Supplies Expenses Accounts Payable Unearned Rent Revenue Cash

2.

Supplies Rent Expense Prepaid RentInterest Payable Utilities Expenses Insurance Expense Accounts Receivable Service Revenue Depreciation Expense Rent Revenue Salaries and Wages Expense Supplies Expenses Notes Payable Interest Expense Dividends Accounts Payable Unearned Rent Revenue Salaries and Wages Payable Cash

3.

Supplies Expenses Rent Expense Supplies Depreciation Expense Utilities Expenses Interest Expense Dividends Notes Payable Salaries and Wages Expense Prepaid RentAccounts Payable Unearned Rent Revenue Salaries and Wages Payable Service Revenue Interest Payable Cash Accounts Receivable Insurance Expense Rent Revenue

4.

Unearned Rent Revenue Interest Expense Insurance Expense Rent Revenue Service Revenue Accounts Payable Prepaid RentSalaries and Wages Expense Supplies Expenses Rent Expense Dividends Interest Payable Salaries and Wages Payable Utilities Expenses Depreciation Expense Cash Accounts Receivable Supplies Notes Payable

5.

Interest Expense Dividends Salaries and Wages Expense Accounts Payable Salaries and Wages Payable Notes Payable Prepaid RentUtilities Expenses Cash Interest Payable Service Revenue Supplies Depreciation Expense Insurance Expense Accounts Receivable Supplies Expenses Unearned Rent Revenue Rent Revenue Rent Expense

6.

Rent Expense Supplies Expenses Unearned Rent Revenue Interest Payable Prepaid RentDepreciation Expense Salaries and Wages Expense Accounts Payable Utilities Expenses Salaries and Wages Payable Insurance Expense Cash Accounts Receivable Supplies Interest Expense Dividends Service Revenue Rent Revenue Notes Payable

7.

Insurance Expense Cash Interest Expense Supplies Expenses Dividends Notes Payable Interest Payable Prepaid RentRent Expense Rent Revenue Service Revenue Salaries and Wages Payable Salaries and Wages Expense Utilities Expenses Accounts Payable Accounts Receivable Unearned Rent Revenue Supplies Depreciation Expense

8.

Cash Accounts Receivable Accounts Payable Unearned Rent Revenue Supplies Rent Expense Utilities Expenses Prepaid RentDepreciation Expense Insurance Expense Dividends Supplies Expenses Salaries and Wages Expense Service Revenue Salaries and Wages Payable Interest Payable Rent Revenue Interest Expense Notes Payable

If the note has been outstanding 10 months, what is the annual interest rate on that note? (Round answer to 1 decimal place, e.g. 7.5%.)
The annual interest rate

%

If the company paid $10,440 in salaries and wages in 2017, what was the balance in Salaries and Wages Payable on December 31, 2016?
Salaries and Wages Payable $

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Explanation / Answer

%=8.4%

If any doubt please comment

No. Date Account Titles and Explanation Debit Credit 1 Dec. 31 Accounts Receivable 3,842 Service Revenue (68180-62393-(5350-3405) 3,842 (To record accrued service revenue) 2 Dec. 31 Supplies expenses 2,915 Supplies 2,915 (To record supplies used) 3 Dec. 31 Insurance Expense 1,595 Prepaid Insurance 1,595 (To expired insurance) 4 Dec. 31 Depreciation Expense 4,930 Accumulated Depreciation-Equipment 4,930 (To record depreciation on equiment) 5 Dec. 31 Interest Expense 602 Interest Payable 602 (To record interest accrued on the note) 6 Dec. 31 Unearned Service Revenue 1,945 Service Revenue (5350-3405) 1,945 (To record service revenue earned) 7 Dec. 31 Salaries and Wages Expense 756 Salaries and Wages Payable (10156-9400) 756 (To record accrued wages)

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