Vedula Advertising was founded by Murali Vedula in January 2020. The following are both the adjusted and unadjusted trial balances as of December 31, 2025.

Instructions

a. Journalize the annual adjusting entries that were made.

b. Prepare an income statement and a retained earnings statement for the year ended December 31, and a classified balance sheet at December 31.

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

d. If the note has been outstanding 10 months, what is the annual interest rate on that note?

e. If the company paid $10,500 in salaries and wages in 2025, what was the balance in Salaries and Wages Payable on December 31, 2024?

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Cash Accounts Receivable Supplies Prepaid Insurance Equipment Accumulated Depreciation-Equipment Notes Payable Accounts Payable Interest Payable Unearned Service Revenue Salaries and Wages Payable Common Stock Retained Earnings Dividends Service Revenue Salaries and Wages Expense Insurance Expense Interest Expense Depreciation Expense Supplies Expense Rent Expense Vedula Advertising Trial Balance December 31, 2025 Unadjusted Dr. $ 11,000 16,000 9,400 3,350 60,000 10,000 9,000 4,350 $123,100 Cr. $ 25,000 8,000 2,000 0 5,000 0 20,000 5,500 57,600 $123,100 Adjusted Dr. $ 11,000 19,500 6,500 1,790 60,000 10,000 9,820 1,560 560 5,000 2,900 4,350 $132,980 Cr. $ 30,000 8,000 2,000 560 3,100 820 20,000 5,500 63,000 $132,980