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Course Name: Principles of Accounting

Q4: On 31/12/2020, the following balances appeared in the trial balance of ABC Company (5marks)

ABC Co. Partial Trial Balance December 31
Prepaid insurance	1,500
Supplies	1,000
Unearned service revenue		1,500
Equipment	50,000

Additional information:

a. An insurance policy examination showed SR1,000 of expired insurance

b. An inventory count showed SR200 of unused shop supplies still available

c. Depreciation expense on shop equipment, SR10,000

d. SR800 of the Unearned service account balance was earned by year-end.

Required :

1. Make the necessary adjusting entries.

2. Show the impact of these adjustments on the income statement and the balance sheet statement.

Answer:

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