The general ledger of Quick Ship at June 30, the end of the company’s fiscal year, includes the following account balances before adjusting entries.

The additional data needed to develop the adjusting entries at June 30 are as follows:
a. The long-term debt is payable in annual installments of \($40,000\), .with the next installment due on July 31. On that date, Quick Ship will also pay one year’s interest at 9%. Interest was last paid on July 31 of the preceding year. Make the adjusting entry to shift the current installment of the long-term note payable to a current liability. Also accrue interest expense at year end.
b. Gross salaries for the last payroll of the fiscal year were \($4,200\). Of this amount, employee payroll taxes payable were \($920\), and salary payable was $3,280.
c. Employer payroll taxes payable were $870.
d. On February 1, the company collected one year’s rent of \($6,000\) in advance.
Requirements
1. Using four-column format, open the listed accounts, inserting the unadjusted June 30 balances.
2. Journalize and post the June 30 adjusting entries to the accounts that you opened. Key adjusting entries by letter.
3. Prepare the liabilities section of the balance sheet at June 30, 2012. Show total current liabilities and total liabilities.

Transcribed Image Text:

Accounts payable Current portion of notes payable Interest payable Salary payable Employee payroll taxes payable 117,000 Employer payroll taxes payable Unearned rent revenue Long-term note payable. 6,000 200,000