North Star prepared the following unadjusted trial balance at the end of its sec

Question

North Star prepared the following unadjusted trial balance at the end of its second year of operations ending December 31.

North Star prepared the following unadjusted trial balance at the end of its second year of operations ending December 31.

3. Summarize the adjusting journal entries in T-accounts. After entering the beginning balances and computing the adjusted ending balances, prepare an adjusted trial balance as of December 31 Prepaid Rent Rent Expense Beg. Bal. Beg. Bal End. Bal. End. Bal Accumulated Depreciation-Equipment Depreciation Expense Beg. Bal. Beg. Bal End. Bal. End. Bal. Accounts Payable Utilities Expense B. al. End. Bal. End. Bal. Income Tax Payable ncome lax Expense Bg. Bl. End. Bal. End. Bal.

Explanation / Answer

Adjusting journal entries are recorded in the T-accounts as mentioned below:

Adjusted Trial Balance is prepared by taking the closing balances from the general ledger.

Prepaid Rent Particulars Amount Particulars Amount Beg Balance 2,500 a. 1,250 2,500 1,250 Ending balance 1,250 Rent Expense Particulars Amount Particulars Amount Beg Balance 0 a. 1,250 1,250 Ending balance 1,250 Depreciation Expense Particulars Amount Particulars Amount Beg Balance 0 b. 1,050 1,050 0 Ending balance 1,050 Accumulated dep-Equipment Particulars Amount Particulars Amount Beg Balance 1,050 b. 1,050 0 2,100 Ending balance 2,100 Utilities Expense Particulars Amount Particulars Amount Beg Balance 13,000 c. 9,500 22,500 0 Ending balance 22,500 Accounts Payable Particulars Amount Particulars Amount Beg Balance 1,050 c. 9,500 10,550 Ending balance 10,550 Income tax expense Particulars Amount Particulars Amount Beg Balance 0 d. 440 440 0 Ending balance 440 Income tax payable Particulars Amount Particulars Amount Beg Balance 0 d. 440 440 Ending balance 440

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