Akram Fun is operating his own gaming business, Fun Unlimited. The unadjusted trial balance for Fun Unlimited at March 31, 2021 had the following normal balances. The company prepares quarterly financial statements.

Account Titles . . . . . . . . . . $
Accounts Payable . . . . . . . . . . . . . 3680
Accounts Receivable . . . . . . . . . . 5300
Akram Fun, Capital . . . . . . . . . . 19000
Cash . . . . . . . . . . . . . . . . . . . . . . . 53700
Depreciation Expense - Equipment . . . . . . . . . . 390
Depreciation Expense - Machinery . . . . . . . . . . 120
Equipment . . . . . . . . . . . . . . . . . 8800
Interest payable . . . . . . . . . . . . . . 1100
Interest Revenue . . . . . . . . . . . . . 650
Machinery . . . . . . . . . . . . . . . . 5500
Notes Payable . . . . . . . . . . . . . 42000
Prepaid Insurance . . . . . . . . . . 2600
Rent Expense . . . . . . . . . . . . . . 220
Service Revenue . . . . . . . . . . . . 3200
Supplies . . . . . . . . . . . . . . . . . . . 300
Unearned Service Revenue . . 3500
Utilities Expense . . . . . . . . . . . . 430

Other Data:

Errors:
1. A debit posting of $2600 to the Accounts Receivable account was made twice.
2. A payment for Utilities Expense was recorded as $230 instead of $520.

Adjustments:
3. The annual interest rate on Notes Payable is 20 %. (The Notes Payable was issued on February 1, 2021)
4. Fun Unlimited has separate insurance policies on its equipment and its machinery. Policy ABC on the equipment, which was purchased on March 1, 2020 for $2400, has a term of one year. Policy XYZ on the machinery, which was purchased on March 1, 2021 for $3800, has a term of three years.
5. Fun Unlimited has 9 salaried employees. Salaries are paid every Thursday for the current week. 4 employees receive a salary of $400 each per week, while the rest of the employees receive a salary of $700 each per week. Employees work five days a week (Sunday to Thursday) and they do not work on weekends (Friday and Saturday). Assume March 31 is a Monday. All the employees work through March 31st.

Instructions:
(a) Journalize the correcting entries for the 3-month period January 1, 2021–March 31, 2021.
(b) Journalize the adjusting entries for the 3-month period January 1, 2021–March 31, 2021.
(c) Journalize the closing entries for Interest Revenue, Salaries Expense and Utilities Expense for the 3-month period January 1, 2021–March 31, 2021.

Answer rating: 100% (QA)

Hence Salaries expense is missing in the Unadjusted trial balance So I just taken only accrued amoun... View the full answer