A review of Circe Ltd’s general ledger and source documents revealed the following additional information for your consideration:

i) The $2,200 of Accounts Receivable does not include $200 of boarding services provided in July, but not yet billed, and $100 of boarding services committed by contract to be rendered in August.

ii) The $1,800 of Office Supplies represents the balance available on 1 July 2020. The $600 of Offices Supplies Expense was for a purchase of office supplies in July. On 31 July, it was estimated that $800 of office supplies remained on hand.

iii) In May 2020, Circe Ltd purchased a 12 month insurance policy, effective the beginning of that month.

iv) The Office Equipment is depreciated at an annual rate of 20% on cost.

v) The Building has been depreciated for one year and eight months as of 1 July 2020.

vi) The Accounts Payable and Other Expenses balances do not include $1,200 of July expenses for which invoices were not received until the beginning of August.

vii) The Unearned Revenue of $6,000 represents customer prepayments for contracts to be performed equally over a five-month period. The July contract was performed but Unearned Revenue and Service Revenue were not adjusted.

viii) The Loan Payable is due two years from now. It carries a 6% annual interest rate, with interest only payments due every three months. The last three-month payment took place the end of May.

ix) The Salaries Expense reflects 20 days of paid work during July. As at 31 July, employees had worked an additional three days that would be paid on the next payroll date in August. The General Ledger includes a Salaries Payable account.

x) You may assume that all balances of all accounts were adjusted and correct at the end of the previous accounting period.

1. Prepare the current asset section of Circe Ltd's Balance Sheet.

2. Prepare the non-current asset section of Circe Ltd's Balance Sheet using the format required in this course.

3. Prepare the liability section of Circe Ltd's Balance Sheet using the format required in this course.

4. Prepare the equity section of Circe Ltd's Balance Sheet using the format required in this course. (Hint: Calculate the ending balance of Retained Earnings as a residual plug/balancing figure.)
 

Transcribed Image Text:

The following information relates to the financial statements portion (questions 7-11 inclusive) of the test. Circe Ltd, a cattery with premises city-wide, prepares monthly financial statements. Its unadjusted trial balance as at 31 July 2020 appears below. Circe Ltd Unadjusted Trial Balance 31 July 2020 Debit Credit $6,000 2,200 1,800 1,500 200,000 800,000 15,000 Cash Accounts Receivable Office Supplies Prepaid Insurance Building Land Office Equipment Accumulated Depreciation Office Equipment Accumulated Depreciation--Building Accounts Payable Unearned Revenue Interest Payable Loan Payable Share Capital Retained Earnings Dividends Boarding Service Revenue Other Expenses Office Supplies Expense Salaries Expense Totals $ 4,000 20,000 3,300 6,000 1,000 200,000 420,000 330,400 2,500 59,300 10,000 600 4,400 S1,044,000 $1,044,000 A review of Circe Ltd's general ledger and source documents revealed the following additional information for your consideration: The following information relates to the financial statements portion (questions 7-11 inclusive) of the test. Circe Ltd, a cattery with premises city-wide, prepares monthly financial statements. Its unadjusted trial balance as at 31 July 2020 appears below. Circe Ltd Unadjusted Trial Balance 31 July 2020 Debit Credit $6,000 2,200 1,800 1,500 200,000 800,000 15,000 Cash Accounts Receivable Office Supplies Prepaid Insurance Building Land Office Equipment Accumulated Depreciation Office Equipment Accumulated Depreciation--Building Accounts Payable Unearned Revenue Interest Payable Loan Payable Share Capital Retained Earnings Dividends Boarding Service Revenue Other Expenses Office Supplies Expense Salaries Expense Totals $ 4,000 20,000 3,300 6,000 1,000 200,000 420,000 330,400 2,500 59,300 10,000 600 4,400 S1,044,000 $1,044,000 A review of Circe Ltd's general ledger and source documents revealed the following additional information for your consideration:

Answer rating: 100% (QA)

1 Current Assets Cash 6000 Account Receivable 2200 Office Supplies 1800 Prepaid Insurance 0 Note Adj... View the full answer