ADJUSTMENTS a.) A count of supplies reveals $300 were on hand on June 30. b.) The $28,000
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ADJUSTMENTS | ||||||||
a.) A count of supplies reveals $300 were on hand on June 30. | ||||||||
b.) The $28,000 insurance policy was purchased on March 1, 2017 for whole year. | March April May June | |||||||
c.) The computers were purchased years ago for 214,000. At the time of purchase, the estimated life of the computers was 10 years with no estimated residual value. | ||||||||
d.) The $30,000 note payable was issued on February 1, 2017 and accrues interest at a 10% annual rate. The note is expected to be repaid in late-2017. | ||||||||
e.) On May 1, 2017 the company entered into a 3-month contract to provide security for a major corporation, the corporation paid $15,000 for their 3-month contract on May 1, | ||||||||
and that amount was correctly recorded as unearned revenue. On June 30, Netlock had fulfilled the first 2 months of the contract. | ||||||||
f.) The company had three employees who were owed for two days of salaries at year end. Each employee earns $250 per day. | ||||||||
g.) On June 1, 2017, the company entered into an agreement to provide service for a new client at a rate of | ||||||||
$4,000 per month. At the end of June the client had received their first month of service but had not yet been billed. | ||||||||
Required: | ||||||||
a.) As necessary, record adjusting journal entries based on items a.) through g.) above. | ||||||||
b.) Using your adjusting journal entries, complete the adjusted trial balance | ||||||||
c.) Based on the adjusted trial balance, prepare an income statement, statement of changes in equity and a balance sheet. Assume no common shares were issued during the year. | ||||||||
h.) Prepare closing entries for the company. | ||||||||
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