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The Controller has provided the following information for purposes of your analysis:

$1.$ Sunshine uses the percentage$-$of$-$receivables method to calculate the bad debt provision each year.

Sunshine has estimated the allowance should be $$40,000$ at the end of the year.

$2.$ During the last quarter of $2024,$ an additional $500$ shares were issued for cash at $$400$ per share. The

accounting for this entry was missed and Sunshine has not recorded the transaction.

$3.$ The prepaid insurance account relates to an amount paid for a $12-$month fire insurance policy. The policy

was paid on August $1,2024.$

$4.$ A year end count of office supplies was completed. Office supplies on hand were $$7,600.$

$5.$ A dividend of $$1\mathrm{.}00$ per share was declared and not yet recorded on December $15.$ Payment is anticipated

$60$ days following declaration of the dividends.

$6.$ The building and equipment were acquired $3$ years ago and are being amortized on a straight$-$line basis

over $20$ years. The estimated residual value of the building is $$70,000.$

$7.$ The Occupy your wrist! Campaign was launched during the year. Sunshine paid $$348,000$ for advertising in

magazines for the period March $1,2024$ to March $1,2025.$ The full amount was recorded as advertising

expense.

$8.$ Employees earned $$22,000$ during December have not been paid, are expected to be paid January $5,2025.$

$9.$ Sunshine$`$s plan for expansion to increase the number of boutiques in the year by $200$ stores, was financed

by issuance of $11\%$ par value bonds in the amount of $$600,000,$ maturing on July $31,2025.$ Interest is paid

on April $1$ and October $1.$ The original amount financed has been correctly recorded.

$10.$ Sunshine received $$100,000$ from a customer midway through the $2024$ year and is required to deliver

goods to the customer by or on March $31,2025.$ The entry for the deposit was recorded as Revenue.

$11.$ Sunshine plans to produce a film called $$Planet Ocean$,$ aimed at raising awareness of oceanic health. On

April $1,2024,$ Sunshine paid an amount of $$50,000$ to photographer Yann Bertand for his services for the

next year. The transactional entry was recorded as a debit to Land.

$12.$ The tax rate is $30\%,$ no tax has been recorded.

Required: Complete the following: $($Hint: You may want to organize the unadjusted trial balance by element

prior to setting up your T$-$accounts. Also, remember to transfer balances from the unadjusted trial balance to

your T$-$accounts before starting.$)$

$1.$ Identify and Prepare all required adjusting entries. This includes all adjusting entries as well as any

correcting entries. Include all calculations, where applicable. Where it is not specified, use a reasonable

account to record the transactions. Descriptions of the journal entries are NOT required. $(24$ marks$)$

$2.$ Prepare an Adjusted Trial Balance at December $31,2024.$ Be sure to prepare the trial balance in a logical

manner by element. $(5$ marks$)$

$3.$ Calculate the ending retained earnings. $(5$ marks$)$

$4.$ Prepare the following statements in good form: $(20$ marks$)$

$$ Statement of Comprehensive Income for the year ended December $31,2024($Income Statement$)$

$$ Statement of Financial Position as at December $31,2024($Balance Sheet$)$

$5.$ Prepare the closing journal entry$($ies$).(6$ marks$)$

State any assumptions clearly in your responses and provide all necessary calculations.