Adjustment data for Giddy Laundry, Inc., for the year ended July 31, 2007, are as follows:

a. Wages accrued but not paid at July 31, $2,000.

b. Depreciation of equipment during the year, $8,000.

c. Laundry supplies on hand at July 31, $1,250.

d. Insurance premiums expired during the year, $2,100.

Instructions

1. Using the integrated financial statement framework shown below, record each adjustment to the appropriate accounts identifying each adjustment by its letter. After all adjustments are recorded, determine the balances.

2. Prepare an income statement and retained earnings statement for the year ended July 31, 2007. The retained earnings balance as of August 1, 2006, was $23,800.
3. Prepare a classified balance sheet as of July 31, 2007.
4. Prepare a statement of cash flows for the year ended July 31,2007.

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Balance Sheet Statement of Cash Flows Income Statement -Liabilities Stockholders' Equity Laundry PrepaidLaundryAccAcct WagesCapital Retained Cash Supplies + Insurance + Equip. Deprec. -Payable + Payable Stock + Earnings 0 30,000 138,500 Assets Balances, July 31, 2007 20,000 4,8003,800 180,000-36,0004,100 Statement of Cash Flows Operating (Revenues225,000 Financing (Capital Stock) 7,500 Operating (Expenses)-125,000 Investing (Equipment) 90,000 Financing (Dividends) 2,000 Income Statement July 225,000 Laundry revenue July -65,000 Wages expense July 22,500 Rent expense July-18,000 Utilities expense July 2,800 Misc. expense INTEGRATED FINANCIAL STATEMENT FRAMEWORK 1 Net increase in cash Beginning cash balance 4,500 Ending cash balance 0,000 5,500