s: Set A TAKING IT FURTHER As at August 31, 2014, approximately how old are the equipment and vehicles? P3-7A The Highland Cove Resort has an August 31 fiscal year end and prepares adjusting entries on a monthly basis. The following trial balance was prepared before recording the August 31 month-end adjustments HIGHLAND COVE RESORT Trial Balance August 31, 2014 Debit Credit Cash Prepaid insurance Supplies Land Buildings $ 17,520 4,240 995 35,000 150,000 Accumulated depreciation-buildings Furniture Accumulated depreciation-furniture $ 47,750 33,000 12,925 Accounts payable 8,500 Unearned revenue 15.000 Mortgage payable 96,000 K. MacPhail, capital 85,000 K. MacPhail, drawings 42,735 Rent revenue 246,150 Depreciation expense 5,775 Insurance expense 6,890 Interest expense 5,720 Repairs expense 14.400 Salaries expense 153,000 Supplies expense 4,450 Utilities expense 37,600 $511,325 $511,325 Additional information: 1. The company pays $6,360 for its annual insurance policy on March 31 of each year. 2. A count shows $560 of supplies on hand on August 31, 2014. 3. The buildings have an estimated useful life of 50 years. 4. The furniture has an estimated useful life of 10 years. 5. Customers must pay a $100 deposit if they want to book a room during peak times. An analysis of these bookings indicates that 150 deposits were received (all credited to Unearned Revenue) and only 40 of the deposits have not yet been earned by August 31, 2014. 6. The mortgage interest rate is 6.5% per year. Interest has been paid to August 1, 2014. 7. Salaries accrued to the end of August were $1,450. 8. The August utility bill of $3,420 is unrecorded and unpaid. 9. On August 31, Highland Cove has earned $1,350 of rent revenue from customers who are currently renting rooms but will not pay the amount owing until they check out in September. This amount is in addition to any deposits earned in item (5) above. Instructions (a) Prepare the monthly adjusting journal entries on August 31. (b) Prepare a ledger, enter the trial balance amounts, and post the adjusting entries. (c) Prepare an adjusted trial balance at August 31. (d) Prepare an income statement and a statement of owner's equity for the year ended August 31, and balance sheet as at August 31, 2014. 1 3 Journal Date Particulars PR Debit Credit 4 5 6 7 18 19 20 21 22 23 24 25 26 27 28 Trial Balance Journal Ledger 3Col_Template Worksheet IncomeStatement Account General Ledger No. H Date PR Balance Debit Credit Particulars Dr/Cr Amount V DR 7 Account B Date 9. 0 1 2 3 4 No PR Balance Debit Credit Particulars Dr/Cr Amount 5 16 27 28 29 30 31 Account No. 32 Date PR Debit Credit 33 Particulars Balance Dr/Cr Amount 34 85 36 Trial Balance Journal Ledger 3Col_Template Worksheet IncomeStatement Ready Accessibility: Investigate If you need additional accounts, just copy and paste the account below into your ledger Account Date Particulars PR Debit Credit No. Balance Dr/Cr Amount ady Trial Balance Accessibility: Investigate Journal Ledger 3Col_Template Worksheet IncomeStatement StmtofOE BalanceSheet Evi... 4 Account Title Trial Balance Adjustments S Debit Credit Debit Credit 6 7 8 9 10 11 2 13 4 5 6 7 8 9 2 3 Worksheet Adjusted Trial Balance Debit Income Statement Balance Sheet Credit Debit Credit Debit Credit 2 3 4 Revenue 5 6 7 8 9 Expenses 10 11 12 13 14 15 16 17 18 19 20 21 Trial Balance Ready Accessibility: Investigate Income Statement Journal Ledger 3Col Template Worksheet IncomeStatement StmtofOE BalanceSheet Ev... + 23 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Ready Trial Balance Accessibility: Investigate Statement of Owner's Equity Journal Ledger 3Col_Template Worksheet IncomeStatement StmtofOE BalanceSheet Ev... 2 3 4 Assets 5 6 7 8 9 10 11 12 13 14 15 Liabilities Balance Sheet 16 17 18 19 20 21 Trial Balance Journal Ledger 3Col Template Worksheet IncomeStatement StmtofOE BalanceSheet Eve... (+)