Below is an unadjusted trial balance run at year end followed by information needed to make adjusting entries.
Baltimore Glass Company
Trial Balance
December 31, 2015

Adjusting items:
1. The remaining prepaid insurance at year end is $3,000
2. A physical inventory shows supplies on hand of $2,000 at year end
3. The prepaid rent of $7,500 covers January 2015 rent
4. Depreciation on equipment is $12,000 for the year
5. At year end sales salaries of $3,000 were earned but unpaid
6. At year end office salaries of $4,000 were earned but unpaid
7. Inventory items with a cost of $35,400 were received on the last day of the year but no invoice was received yet.
8. A physical count of inventory shows a value of $219,100. The periodic inventory method is used.
Do the following requirements below. Create proper headings for each statement.
1. Record adjusting journal entries from information above. It is possible that an item may not require an entry
2. Prepare an adjusted trial balance including the adjusting entries made
3. Prepare a classified income statement. Supplies is a sales expense. January 1 inventory was $219,115.
4. Prepare a statement of retained earnings
5. Prepare a classified balance sheet
6. Prepare closing journal entries

Transcribed Image Text:

Acct. Account Title Credit No. Debit 101 Cash 88,450 Accounts Receivable 110 195,613 Merchandise Inventory Supplies on Hand Prepaid Insurance Prepaid Rent Equipment Accumulated Depreciation Accounts Payable Wages Payable Capital Stock Retained Eamings, January 1 Sales 256,250 3,252 120 125 130 3,500 7,500 131 150 175,285 24,260 72,555 160 202 210 220,000 211,144 998,250 301 302 401 405 Sales Retums and Allowances 5,145 410 Interest Income 1,500 500 560,880 Purchases 501 Purchases Discounts 4,080 502 Purchases Retums and Allowances 1,200 Freight In Advertising Expense Sales Salaries Expense Supplies Expense Office Salaries Expense Utilities Expense Insurance Expense Professional Fees Expense 505 4,580 520 1,000 88,600 530 532 540 124,500 8,594 550 555 3,000 560 570 Depreciation Expense Interest Expense 580 6,840 1,532,989 1,532,989