ALL WORKING MUST BE SHOWN IN THE ANSWER BOOK. SECTION B: Problem-solving Question (Total 24 marks) QUESTION 1 The following trial balance was extracted from the books of the Liberty Video Company: Unadjusted Trial Balance 31 December 2016 Debit Credit Cash 50,000 ccounts receiva 30,000 Prepaid Insurance Accumulated depreciation equipment Notes payable (due in one year) Retained Earnings Rent expenses ul 30,000 25,000 8,000 ren 100 36,000 201,000 Totals 201,000 The required adjustments for the year end were: a) The unexpired insurance for the year ended was $18,000. b) A part-time storekeeper at a hourly wage rate $60 was hired for conducting inventory count. Total 30 work hours has not yet paid to the worker by the year end. Company uses straight line depreciation method. for renting a maximum 40 videos each month during the year. The Company has not c) The equipment was expected to use for 18 years with S25,000 residual value. The d) Happy Club, a customer located in the same district, agreed to pay a $500 monthly fee billed the Club for the last three months of 2016 REQUIRED 1) Prepare the adjusting journal entries at 31 December 2016 (show workings and ignore explanations). (8 marks) 2) Prepare a Statement of Comprehensive Income for the year ended 31 December 2016 and a Statement of Financial Position as at 31 December 2016. (16 marks)