Refer to the data in Problem 5-4A.

In problem 5-4A

The trial balance of Kim's Fine Gems pertains to December 31, 2014, and is shown below.

Additional data at December 31, 2014:
a. Rent expense for the year, $48,000.
b. The equipment has an estimated useful life of 10 years and is expected to have no value when it is retired from service.
c. Accrued salaries at December 31, $7,000.
d. Accrued interest expense at December 31, $2,600.
e. Inventory based on the inventory count on December 31, $351,200.
Required
1. Journalize the adjusting and closing entries.
2. Determine the December 31, 2014, Capital balance for Kim's Fine Gems.

Transcribed Image Text:

KIM'S FINE GEMS Trial Balance December 31, 2014 $ 6,200 Cash Accounts receivable 57,000 Inventory 354,800 Prepaid rent Equipment Accumulated amortization-equipment 28,000 108,000 $ 43,200 43,200 Accounts payable Salary payable Interest payable Note payable, long-term J. Kim, capital J. Kim, withdrawals 87,000 270,000 153,000 835,400 Sales revenue Cost of goods sold 328,000 Salary expense 118,600 Rent expense 44,000 Advertising expense 21,600 Utilities expense 30,800 Amortization expense equipment Insurance expense 13,200 2,600 Interest expense Miscellaneous expense 13,000 $1,278,800 Total $1,278,800