Refer to the data for Rainbow Lodge Ltd. in P4-12A. In P4-12A The following is the unadjusted

Question:

Refer to the data for Rainbow Lodge Ltd. in P4-12A.

In P4-12A

The following is the unadjusted trial balance for Rainbow Lodge Ltd. at its year end, May 31. The company adjusts its accounts monthly.

Additional information:
1. The annual insurance policy was purchased on October 1, 2011, for $10,920.
2. A count of supplies shows $1,340 of supplies on hand on May 31.
3. The building has an estimated useful life of 20 years.
4. The furniture has an estimated useful life of five years.
5. Customers must pay a $100 deposit if they want to book a room in advance during the peak period. An analysis of these bookings indicates that 175 deposits were received and credited to Unearned Revenue. By May 31, 25 of the deposits were earned.
6. On May 25, a local business contracted with Rainbow Lodge to rent one of its housekeeping units for four months, starting June 1, at a rate of $2,800 per month. An advance payment equal to one month's rent was paid on May 25 and credited to Rent Revenue.
7. On May 31, Rainbow Lodge has earned $1,780 of rent revenue from customers who are currently staying at the inn. The customers will only pay the amount owing when they check out in early June.
8. Salaries of $1,590 are unpaid at May 31.
9. The mortgage interest rate is 8%. Interest has been paid to May 1; the next payment is due June 1.
10. The May utility bill of $2,240 has not yet been recorded or paid.
11. Income taxes for the month of May are estimated to be $1,000.
12. During the month of May, $4,000 of common shares were issued.
Instructions
(a) Prepare the closing journal entries.
(b) Post the closing entries to the T accounts prepared in P4-12A.
(c) Prepare a post-closing trial balance at May 31.