Data Provided:

• The advance payment of rent on December 1st covered a period of 3 months (December to February)

• The rental equipment purchased is being depreciated on a straight-line basis over 8 years.

• Office supplies on hand on December 31st total $600.

• During December, the company earned $3,700 of the rental fees paid by Joe MacDonald on December 8th.

• Salaries earned by the employees from December 26th to December 31st totalled $1,400. This will not be paid until the next pay day January 9th.

Requirements:

1. Prepare journal entries for the December transactions. Descriptions are not required. You do not need to prepare adjusting entries in requirement 1.

2. Using the additional data provided, prepare the required adjusting journal entries for December 31st.

3. Prepare an income statement for the year ended December 31st, 2021.

4. Prepare a statement of retained earnings for the year ended December 31st, 2021.

5. Prepare a balance sheet as at December 31st, 2021.

Answer rating: 100% (QA)

Journal entries for December transactions Rent received in advance Cash 4500 Unearned Rent 4500 Purc... View the full answer