Recording Adjusting and Closing Entries and Preparing a Balance Sheet and Incon Statement Including Earnings per...

Transcribed Image Text:

Recording Adjusting and Closing Entries and Preparing a Balance Sheet and Incon Statement Including Earnings per Share (AP4-7) Tunstall, Inc., a small service company, keeps its records without the help of an accountant. After effort, an outside accountant prepared the following unadjusted trial balance as of the end of the accounting period on December 31: FILE HOME INSERT PAGE LAYOUT %Cut Paste G29 1 2 WN 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Copy- Format Painter Clipboard A E Calibri BIU f Font FORMULAS DATA VIEW Wrap Text AF Merge & Center G Other assets Accounts payable Wages payable Income taxes payable Cash Accounts receivable Supplies Prepaid insurance Service trucks Accumulated depreciation REVIEW B Alignment G General TUNSTALL, INC. Undjusted Trial Balance at December 31 Number Note payable (3 years; 10% interest due each September 30) Common stock (5,000 shares outstanding) Additional paid-in capital Retained earnings Service revenue Wages expense Remaining expenses (not detailed; excludes income tax) Income tax expense Total Conditional Formatas Cel Formatting Table Styles- Styles C Debit 42,000 11,600 900 800 19,000 8,300 16,200 17,160 inser Credit 9,200 3,000 17,000 400 19,000 6,000 61,360 115,960 115,960 Data not yet recorded at December 31 included a. The supplies count on December 31 reflected $300 in remaining supplies on hand to be used in the next year. b. Insurance expired during the current year, $800. c. Depreciation expense for the current year, $3,700. d. Wages earned by employees not yet paid on December 31, $640. e. Three months of interest expense (for the note payable borrowed on October 1 of the current year) was incurred in the current year. f. Income tax expense, $5,540. Required: 1. Record the adjusting entries. 2. Prepare an income statement (with Operating Income and Other Items sections) and a classified bal- ance sheet that include the effects of the preceding six transactions. 3. Record the closing entry. Recording Adjusting and Closing Entries and Preparing a Balance Sheet and Incon Statement Including Earnings per Share (AP4-7) Tunstall, Inc., a small service company, keeps its records without the help of an accountant. After effort, an outside accountant prepared the following unadjusted trial balance as of the end of the accounting period on December 31: FILE HOME INSERT PAGE LAYOUT %Cut Paste G29 1 2 WN 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Copy- Format Painter Clipboard A E Calibri BIU f Font FORMULAS DATA VIEW Wrap Text AF Merge & Center G Other assets Accounts payable Wages payable Income taxes payable Cash Accounts receivable Supplies Prepaid insurance Service trucks Accumulated depreciation REVIEW B Alignment G General TUNSTALL, INC. Undjusted Trial Balance at December 31 Number Note payable (3 years; 10% interest due each September 30) Common stock (5,000 shares outstanding) Additional paid-in capital Retained earnings Service revenue Wages expense Remaining expenses (not detailed; excludes income tax) Income tax expense Total Conditional Formatas Cel Formatting Table Styles- Styles C Debit 42,000 11,600 900 800 19,000 8,300 16,200 17,160 inser Credit 9,200 3,000 17,000 400 19,000 6,000 61,360 115,960 115,960 Data not yet recorded at December 31 included a. The supplies count on December 31 reflected $300 in remaining supplies on hand to be used in the next year. b. Insurance expired during the current year, $800. c. Depreciation expense for the current year, $3,700. d. Wages earned by employees not yet paid on December 31, $640. e. Three months of interest expense (for the note payable borrowed on October 1 of the current year) was incurred in the current year. f. Income tax expense, $5,540. Required: 1. Record the adjusting entries. 2. Prepare an income statement (with Operating Income and Other Items sections) and a classified bal- ance sheet that include the effects of the preceding six transactions. 3. Record the closing entry.

Answer rating: 100% (QA)

1 Working notes are prepared for adjusting entries a Supplies Expense Supplies Available Supplies Balance 900 300 600 b Interest Expense Notes Payable ... View the full answer