Question

The trial balance and the other information for consulting engineers Mustang Rovers Consulting Limited follow:
Additional information:
1. Fees received in advance from clients were $6,900.
2. Services performed for clients that were not recorded by December 31 were $7,300.
3. Bad debt expense for the year was $6,300.
4. Insurance expense included a premium paid on December 31 in the amount of $6,000 for the period starting on
January 1, 2015.
5. Equipment, net of accumulated depreciation, is being depreciated at 9% per year.
6. Mustang gave the bank a 90-day, 12% note for $7,200 on December I, 2014.
7. Rent is S750 per month. The rent for 2014 and for January 2015 has been paid.
8. Salaries and wages earned but unpaid at December 31, 2014, were $2,5!0.
9. Dividends of $80,000 were declared for payment on February 1, 20! 5.
Instructions
(a) From the trial balance and other information given, prepare annual adjusting entries as at December 31, 2014.
(b) Prepare an income statement for 2014, a balance sheet as at December 31, 2014, and a statement of retained earnings for 2014.


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  • CreatedSeptember 18, 2015
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