Raymond Company's trial balance at December 31, 2017, is presented below. All 2017 transactions have been recorded except for the items described below and on page 473.

Unrecorded transactions:
1. On May 1, 2017, Raymond purchased equipment for £13,000 plus sales taxes of £780 (all paid in cash).
2. On July 1, 2017, Raymond sold for £3,500 equipment which originally cost £5,000. Accumulated depreciation on this equipment at January 1, 2017, was £1,800; 2017 depreciation prior to the sale of the equipment was £450.
3. On December 31, 2017, Raymond sold on account £9,400 of inventory that cost £6,600.
4. Raymond estimates that uncollectible accounts receivable at year-end is £4,000.
5. The note receivable is a one-year, 8% note dated April 1, 2017. No interest has been recorded.
6. The balance in prepaid insurance represents payment of a £4,400 6-month premium on October 1, 2017.
7. The building is being depreciated using the straight-line method over 40 years. The residual value is £20,000.
8. The equipment owned prior to this year is being depreciated using the straight-line method over 5 years. The residual value is 10% of cost.
9. The equipment purchased on May 1, 2017, is being depreciated using the straight-line method over 5 years, with a residual value of £1,000.
10. The patent was acquired on January 1, 2017, and has a useful life of 10 years from that date.
11. Unpaid salaries and wages at December 31, 2017, total £2,200.
12. The unearned rent revenue of £6,000 was received on December 1, 2017, for 4 months rent.
13. Both the short-term and long-term notes payable are dated January 1, 2017, and carry a 9% interest rate. All interest is payable in the next 12 months.
14. Income tax expense was £17,000. It was unpaid at December 31.
Instructions
(a) Prepare journal entries for the transactions listed above.
(b) Prepare a December 31, 2017, adjusted (entries 4-14 are adjustments) trial balance.
(c) Prepare a 2017 income statement and a 2017 retained earnings statement.
(d) Prepare a December 31, 2017, classified statement of financial position.

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Debit Credit Accounts Payable Income Taxes Payable Salaries and Wages Payable Unearned Rent Revenue Notes Payable (due in 2018) Interest Payable Notes Payable (due after 2018) Share Capital-Ordinary Retained Earnings Dividends Sales Revenue Interest Revenue Rent Revenue Gain on Disposal of Plant Assets Bad Debt Expense Cost of Goods Sold 28,300 6,000 11,000 35,000 50,000 63,600 12,000 910,000 630,000 iation Expense Income Tax Expense Insurance Expense Interest Expense Other Operating Expenses Amortization Expense Salaries and Wages Expense Total 61,800 110,000 £1,177,200 £1,177,200