Victoria Company has the following account balances on December 31
Victoria Company has the following account balances on December 31, 2016, prior to any adjustments:
Additional adjustment information: (a) depreciation on buildings, $1,100; on equipment, $600; (b) bad debts expense, $240; (c) interest accumulated but not paid: on note payable, $50; on mortgage payable, $530 (this interest is due during the next accounting period); (d) insurance expired, $175; (e) salaries accrued but not paid $370; (f) rent was collected in advance and the performance obligation is now satisfied, $800; (g) office supplies on hand at year-end, $230 (expensed when originally purchased earlier in the year); and (h) the income tax rate is 30% on current income and is payable in the first quarter of 2017.
1. Transfer the account balances to a 10-column worksheet and prepare a trial balance.
2. Prepare the adjusting entries in the general journal and complete the worksheet.
3. Prepare the company’s income statement, retained earnings statement, and balance sheet.
4. Prepare closing entries in the general journal.
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