Consider the unadjusted trial balance of Princess, Inc., at August 31, 2012, and the related month-end adjustment data.

Adjustment data at August 31, 2012, include the following:
a. Accrued advertising revenue at August 31, $2,100.
b. Prepaid rent expired during the month. The unadjusted prepaid balance of $2,100 relates to the period August 2012 through October 2012.
c. Supplies used during August, $2,090.
d. Depreciation on furniture for the month. The furniture’s expected useful life is three years.
e. Accrued salary expense at August 31 for Monday, Tuesday, and Wednesday. The five-day weekly payroll is $5,100 and will be paid on Friday.

Requirements
1. Using Exhibit 3-9 as an example, prepare the adjusted trial balance of Princess, Inc., at August 31, 2012. Key each adjusting entry by letter.
2. Prepare the monthly income statement, the statement of retained earnings, and the classified balance sheet. Draw arrows linking the three statements.

Transcribed Image Text:

Princess, Inc. Trial Balance Work Sheet August 31, 2012 Adjusted Trial Balance Trial Balance Adjustments Debit CreditDebit Credit Debit Credit Account Cash Accounts receivable Prepaid rent Supplies Furniture Accumulated depreciation Accounts payable Salary payable Common stock Retained earnings Dividends Service revenue Salary expense Rent expense Utilities expense Depreciation expense Supplies expense Total 8,300 1,900 2,100 2,400 63,000 3,700 4,000 13,000 53,430 4,300 11,000 2,600 530 85,130 85,130