Wells Technical Institute (WTI), a Tristana Wells-owned school, provides training to individuals who pay tuition directly to the school. WTI also offers group training at off-site locations. Below is your unadjusted trial balance as of December 31, 2017. WTI initially records prepaid expenses and unearned income in balance sheet accounts. Items a through h that require adjusting entries as of December 31, 2017 are described below

. Additional Information Items

An analysis of the WTI insurance policies shows that $3,335 of coverage has expired.

An inventory count shows that teaching materials costing $2,891 are available at the end of 2017.

The annual depreciation of the equipment is $13,342.

The annual depreciation of the professional library is $6,671.

On November 1, WTI agreed to run a special six-month course (starting immediately) for a client. The contract calls for a monthly fee of $2,500 and the client paid for the first five months in advance. When the cash was received, the Unearned Training Fees account was credited. The sixth month's fee will be recorded when it is collected in 2018.

On October 15, WTI agreed to run a four-month (from now) class for one individual for a monthly tuition of $4,061 payable at the end of the class. The class started on October 15, but no payment has been received yet. (WTI accruals apply to the nearest half-month; for example, October recognizes half-month accrual.)

The two WTI employees are paid weekly. At the end of the year, two days' wages have been accrued at the rate of $100 per day for each employee.

The balance in the Prepaid Rent account represents the rent for December.

INSTITUTO TÉCNICO DE POZOS Unadjusted trial balance December 31, 2017
	Debit			Credit
Money	ps	27,396
accounts receivable		0
teaching materials		10,536
prepaid insurance		15,806
prepaid rent		2,108
professional library		31,610
Accumulated Depreciation—Professional Library				ps	9,484
Equipment		73,751
Accumulated Depreciation—Equipment					16,861
Accounts payable					37,022
Salaries to pay					0
Unearned training fees					12,500
Common actions					12,000
Retained earnings					55,016
dividends		42,149
Earned Tuition Fees					107,477
Training Fees Earned					40,040
Depreciation Expense—Professional Library		0
Depreciation Expense—Equipment		0
salary expenses		50,579
insurance costs		0
Rental costs		23,188
Didactic material expenses		0
advertising expenses		7,376
Public service spending		5,901
Totals	ps	290.400		ps	290.400

2-a. Post the unadjusted trial balance balance and adjust entries to the T accounts.

2-b. Prepare the income statement of Wells Technical Institute for the year 2017.

TECHNICAL INSTITUTE OF WELLS
Statement of income
For the year ended December 31, 2017

Answer rating: 100% (QA)

Income statement for Wells Technical Institute for 2017 TAccounts Debit Credit Cash 27396 Accounts R... View the full answer