E3.15 (LO 2, 3, 4) AP The trial balances before and after adjustment for Lane Company at October 31, 2021, which is the end of its fiscal year, are as follows:

Prepare adjusting entries from analysis of trial balances and prepare financial statements from adjusted trial balance.

Before Adjustment After Adjustment

Debit Credit Debit Credit

Cash $9,100 $9,100

Accounts receivable 8,700 9,230

Supplies 2,450 710

Prepaid insurance 3,775 2,525

Equipment 34,100 34,100

Accumulated depreciationequipment $3,525 $5,800

Accounts payable 5,900 5,900

Notes payable 40,000 40,000

Salaries payable 0 1,125

Interest payable 0 500

Unearned revenue 1,600 900

E. Lane, capital 5,600 5,600

E. Lane, drawings 10,000 10,000

Service revenue 45,000 46,230

Depreciation expense 0 2,275

Insurance expense 0 1,250

Interest expense 1,500 2,000

Rent expense 15,000 15,000

Salaries expense 17,000 18,125

Supplies expense 0 1,740

Totals $101,625 $101,625 $106,055 $106,055

Instructions

a. Prepare the adjusting entries that were made.

b. Prepare Lane Company's income statement, statement of owner's equity, and balance sheet.