Balke Laboratory began operations on July 1, 2017, and provides diagnostic services for physicians and medical clinics. The company’s fiscal year ends on June 30, and the accounts are adjusted annually on this date. Balke’s unadjusted trial balance as of June 30, 2019, is as follows:

The following information is also available:

1.The Prepaid Insurance account balance represents a premium paid on January |, 2019, for two years of fire and casualty insurance coverage. Before 2019, Balke Laboratory had no insurance protection.

2.The supplies were physically counted at June 30, 2019. The count totaled $6,300.

3.All laboratory equipment was purchased on July 1, 2017. It is expected to last nine years.

4.Balke Laboratory received a \($4,000\) cash payment on April 1, 2019, from Boll Clinic for diagnostic services to be provided uniformly over the four months beginning April 1, 2019. Balke credited the payment to Diagnostic Fees Received in Advance. The services for April, May, and June have been provided to Boll Clinic.

5.Unpaid wages at June 30, 2019, were $600.

6.Balke Laboratory rents facilities for \($2,000\) per month. Because of cash flow problems, Balke was unable to pay the rent for June 2019. The landlord gave Balke permission to delay the payment until July.

Required

a. Make the necessary adjusting entries as of June 30, 2019.

b. Prepare the adjusted trial balance as of June 30, 2019.

c. Prepare the Income Statement, Balance Sheet, and Statement of Stockholders’ Equity for Balke Laboratory at June 30, 2019.

d. Make the necessary closing entries as of June 30, 2019.

e. Prepare the post-closing trial balance as of June 30, 2019.

Transcribed Image Text:

BALKE LABORATORY Unadjusted Trial Balance June 30, 2019 Cash.... Accounts receivable Prepaid insurance. Supplies.. Laboratory equipment.. Accumulated depreciation-Laboratory equipment Accounts payable... Diagnostic fees received in advance Common stock Retained earnings Diagnostic fees revenue.. Wage expense Rent expense.. Totals Debit Credit 1,000 9,200 6,000 31,300 270,000 $ 30,000 3,100 4.000 58,000 22,000 $397,500 90,000 50,000 220.400 $397,500