Comprehensive Problem 2 (Algo) Skip to question [The following information applies to the questions displayed below.]

Music-Is-Us, Inc., is a supplier of musical instruments for professional and amateur musicians. The companys accountants make adjusting entries monthly, and they make all closing entries annually. The company is growing rapidly and prides itself on having no long-term liabilities.

The company has provided the following trial balance dated December 31, 2021.

MUSIC-IS-US, INC. TRIAL BALANCE DECEMBER 31, 2021 Cash at bank $ 54,000 Marketable securities 28,000 Accounts receivable 129,000 Allowance for doubtful accounts $ 5,600 Merchandise inventory 254,000 Office supplies 2,100 Prepaid insurance 6,160 Building and fixtures 1,793,000 Accumulated depreciation 796,000 Land 69,800 Accounts payable 63,000 Unearned customer deposits 7,800 Income taxes payable 73,000 Capital stock 920,000 Retained earnings 240,200 Unrealized holding gain on investments 5,500 Sales 1,697,980 Cost of goods sold 951,000 Bank service charges 120 Uncollectible accounts expense 8,500 Salary and wages expense 387,000 Office supplies expense 300 Insurance expense 6,100 Utilities expense 3,000 Depreciation expense 44,000 Income tax expense 73,000 $ 3,809,080 $ 3,809,080

Other information pertaining to the companys trial balance is provided as follows.

The most recent bank statement reports a balance of $57,185. Included with the bank statement was a $2,100 check from Iggy Smarts, a professional musician, charged back to Music-Is-Us as NSF. The banks monthly service charge was $15. Three checks written by Music-Is-Us to suppliers of merchandise inventory had not yet cleared the bank for payment as of the statement date. These checks included: no. 508, $4,500; no. 511, $9,300; and no. 521, $7,900. Deposits of $16,400 reached the bank too late for inclusion in the current bank statement. The company prepares a bank reconciliation at the end of each month.

Music-Is-Us has a portfolio of marketable securities that originally cost $22,500. As of December 31, the market value of these securities was $30,100. All short-term investments are classified as "available for sale."

During December, $6,100 of accounts receivable were written off as uncollectible. A recent aging of the company's accounts receivable led management to conclude that an allowance for doubtful accounts of $8,000 is needed at December 31, 2021.

The company uses a perpetual inventory system. A year-end physical count revealed that several guitars reported in the inventory records were missing. The cost of the missing units amounted to $1,250. This amount is not considered significant relative to the total cost of inventory on hand. At December 31, approximately $830 in office supplies remained on hand.

The company pays for its insurance policies 12 months in advance. Its most recent payment was made on November 1, 2021. The cost of this policy was slightly higher than the cost of coverage for the previous 12 months.

Depreciation expense related to the company's building and fixtures is $5,000 for the month ending December 31, 2021.

Although Music-Is-Us carries an extensive inventory, it is not uncommon for experienced musicians to order custom guitars made to their exact specifications. Manufacturers do not allow any sales returns of custom-made guitars. The entire sales amount is collected at the time a custom order is placed, and is credited to an account entitled Unearned Customer Deposits. As of December 31, $4,200 of these deposits remained unfilled because the special-order guitars have not been received from the manufacturer. The cost of goods sold and the reduction in inventory associated with all custom orders is recorded when the custom merchandise is delivered to customers. At that time, the adjusting entry requires only a decrease to unearned customer deposits and an increase in sales.

Accrued income taxes payable for the entire year ending December 31, 2021, total $80,000. No income tax payments are due until early in 2022.

Comprehensive Problem 2 (Algo) Part j j. On the basis of the adjustments made to the accounting records in parts a through i, prepare the company's adjusted trial balance at December 31, 2021.