Refer to the data in Problem 5-34A.

1. Journalize Harley's adjusting and closing entries.

2. Determine the December 31, 2009, balance of J. Harley, Capital.

Problem 5-34A

Harley's of Chicago's trial balance pertains to December 31, 2009.

Adjustment data at December 31, 2009:

a. Prepaid rent expired, $3,000.

b. Depreciation, $5,000.

c. Accrued salaries, $1,000.

d. Inventory on hand, $71,000.

Requirements 

Complete Harley's accounting work sheet for the year ended December 31, 2009. Key adjusting entries by letter.

HARLEY'S OF CHICAGO Trial Balance December 31, 2009 Cash $ 7,000 Accounts receivable 4,000 Inventory 73,000 Prepaid rent 5,000 Equipment 22,000 Accumulated depreciation $ 8,000 Accounts payable 6,000 Salary payable Note payable, long-term 18,000 J. Harley, capital 50,000 J. Harley, withdrawals 39,000 Sales revenue 170,000 Cost of goods sold 67,000 Salary expense 24,000 Rent expense 7,000 Utilities expense 3,000 Depreciation expense Interest expense 1,000 Total $252,000 $252,000