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Part 1: Use the following unadjusted trial balance to prepare adjusting entries, given the additional information below it. Assume that financial statements are prepared quarterly. Omit explanations.

 

Shayna’s Financial Services

Trial Balance

September 30, 2010

Cash

$ 30,000

Accounts Receivable

9,600

Office Supplies

1,600

Prepaid Rent

5,400

Office Furniture

14,400

Accumulated Depreciation–Office Furniture

$      600

Accounts Payable

22,200

Unearned Revenue

3,000

Shayna Glick, Capital

30,600

Consulting Revenue

18,000

Salaries Expense

11,000

Insurance Expense

    2,400

_______

 

$74,400

$74,400

 

a. Of the revenue received in advance, 60 percent remained unearned on September 30.

b. The office furniture has an estimated 12-year useful life and zero value at the end of that time. Record depreciation for the quarter.

c. Salaries earned, but unpaid, totaled $2,600.

d. The Prepaid Rent applies to the six months beginning July 1, 2010.

e. Office supplies on hand totaled $600 at the end of the quarter.

f. Services performed but not yet billed or recorded amount to $3,000.

Part 2: Prepare year-end adjusting entries for each of the following situations.

a. The Office Supplies account showed a beginning debit balance of $600 and purchases of $1,000. The ending debit balance was $400.

b. Depreciation on buildings is estimated to be $7,600.

c. A one-year insurance policy was purchased for $6,000. Four months have passed since the purchase.

d. Accrued interest on notes payable amounted to $1,500.

e. The company received a $14,400 advance payment during the year on services to be performed. By the end of the year, two-thirds of the services had been performed.

f. Payroll for the five-day workweek, to be paid on Friday, is $14,000. The last day of the period is a Wednesday.

g. Services totaling $780 had been performed but not yet billed or recorded.