Sears Editing Company is a small editorial services company owned and operated by Deloris Sears. On January 31, 20Y1, the end of the current year, Sears Editing Company’s accounting clerk prepared the following unadjusted trial balance:

The data needed to determine year-end adjustments are as follows:
• Unexpired insurance at January 31, $2,400.
• Supplies on hand at January 31, $250.
• Depreciation of building for the year, $6,600.
• Depreciation of equipment for the year, $3,500.
• Rent unearned at January 31, $2,750.
• Accrued salaries and wages at January 31, $1,800.
• Fees earned but unbilled on January 31, $15,000.

Instructions
1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense— Equipment; and Supplies Expense.
2. Determine the balances of the accounts affected by the adjusting entries, and prepare an adjusted trial balance.

Transcribed Image Text:

Sears Editing Company Unadjusted Trial Balance January 31, 20Y1 Debit Credit Balances Balances Cash 7,500 Accounts Receivable. Prepaid Insurance Supplies.. 38,400 7,200 1,980 112,500 150,250 Land Building .. Accumulated Depreciation-Building. Equipment... Accumulated Depreciation-Equipment. Accounts Payable Unearned Rent.. 87,550 135,300 97,950 12,150 6,750 Common Stock 75,000 Retained Earnings Dividends 146,000 15,000 Fees Earned.. 324,600 Salaries and Wages Expense. Utilities Expense Advertising Expense.. Repairs Expense.. Miscellaneous Expense 193,370 42,375 22,800 17,250 6,075 750,000 750,000