The unadjusted trial balance as of December $31,2024,$ for the Bags Consulting Company appears below. December $31$ is the company$$s reporting year$-$end.

Account Title Debits Credits

Cash $ $11,350$

Accounts receivable $7,500$

Prepaid insurance $3,100$

Land $210,000$

Buildings $57,500$

Accumulated depreciation$$buildings $ $23,000$

Office equipment $90,000$

Accumulated depreciation$$office equipment $36,000$

Accounts payable $28,500$

Salaries payable $0$

Deferred rent revenue $10,800$

Common stock $220,000$

Retained earnings $46,500$

Service revenue $80,500$

Interest revenue $4,000$

Rent revenue $0$

Salaries expense $31,000$

Depreciation expense $0$

Insurance expense $0$

Utilities expense $20,700$

Maintenance expense $18,150$

Totals $ $449,300$ $ $449,300$

Information necessary to prepare the year$-$end adjusting entries appears below.

The buildings have an estimated useful life of $50$ years with no salvage value. The company uses the straight$-$line depreciation method.

The office equipment is depreciated at $10$ percent of original cost per year.

Prepaid insurance expired during the year, $$1,550.$

Accrued salaries at year$-$end, $$1,200.$

Rent to customers who paid in advance has been provided for $$7,400.$

Required:

From the trial balance and information given, prepare adjusting entries.

Post the beginning balances and adjusting entries into the appropriate T$-$accounts.

Prepare an adjusted trial balance.

Prepare closing entries.

Prepare a post$-$closing trial balance.

Answer rating: 100% (QA)

To prepare adjusting entries you need to consider the following Depreciation expense for buildings The buildings have an estimated useful life of 50 years with no salvage value The company uses the st... View the full answer