Aber Corporation€™s statement of financial position at December 31, 2010, is presented below.

During 2011, the following transactions occurred.
1. Aber paid $3,000 interest on the bonds on January 1, 2011.
2. Aber purchased $241,100 of inventory on account.
3. Aber sold for $450,000 cash inventory which cost $250,000. Aber also collected $27,000 sales taxes.
4. Aber paid $230,000 on accounts payable.
5. Aber paid $3,000 interest on the bonds on July 1, 2011.
6. The prepaid insurance ($5,600) expired on July 31.
7, On August 1, Aber paid $10,200 for insurance coverage from August 1, 2011, through July 31, 2012.
8. Aber paid $17,000 sales taxes to the state.
9. Paid other operating expenses, $91,000.
10. Retired the bonds on December 31, 2011, by paying $48,000 plus $3000 interest.
11. Issued $90.000 of 8% bonds on December 31, 2011, at 104. The bonds pay interest every June 30 and December 31.
Adjustment data:
1. Recorded the insurance expired from item 7.
2. The equipment was acquired on December 31, 2010, and will be depreciated on a straight-line basis over 5 years with a $3,000 salvage value.
3. The income tax rate is 30%.

Instructions
(You may want to set up T accounts to determine ending balances.)
(a) Prepare journal entries for the transactions listed above and adjusting entries.
(b) Prepare an adjusted trial balance at December 31, 2011.
(c) Prepare an income statement and a retained earnings statement for the year ending December 31, 2011, and a classified statement of financial position as of December 31,2011.

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ABER CORPORATION Statement of Financial Position December 31, 2010 Equipment Prepaid insurance Inventory Cash $38.000 Share capital-ordinary $20.000 13.100 50.000 13.750 3,000 $99,850 5,600 25,750 30,500 $99,850 Retained earnings Bonds payable Accounts payable Bond interest payable