Using the information from 2-8. Prepare and complete a worksheet similar to 2A-1. Using the information in the worksheet to prepare an income statement and a statement of shareholders' equity from 2021 and a balance sheet as of December 31, 2021. Cash dividends paid to shareholders during the year amounted to $6000. Also, prepare the necessary closing entries assuming that adjusting entries have been currently posted to the accounts.

2-8

2A-1 (an example of what you need to do)

P 2-8 Adjusting entries @LO2-6 Excalibur Corporation sells video games for personal computers. The unadjusted trial balance as of December 31, 2021, appears below. December 31 is the company's reporting year-end. The company uses the perpetual inventory system. Account Title Debits Credits Cash 23,300 Accounts receivable 32.500 Supplies -0- -0- Prepaid rent Inventory 65.000 Office equipment 75,000 Accumulated depreciation Accounts payable Salaries payable Notes payable 10.000 26,100 3.000 30,000 80,000 Common stock Retained earnings 22.050 Dividends 6,000 Sales revenue 180.000 Cost of goods sold 95.000 Interest expense -0- Salaries expense 32.350 Rent expense 14,000 Supplies expense 2.000 Utilities expense 6.000 Totals 351,150 351,150 Information necessary to prepare the year-end adjusting entries appears below. 1. The office equipment was purchased in 2019 and is being depreciated using the straight-line method over a ten-year useful life with no salvage value. 2. Accrued salaries at year-end should be $4,500. 3. The company borrowed $30,000 on September 1, 2021. The principal is due to be repaid in 10 years. Interest is payable twice a year on each August 31 and February 28 at an annual rate of 10%. 4. The company debits supplies expense when supplies are purchased. Supplies on hand at year-end cost $500. 5. Prepaid rent at year-end should be $1,000. Required: Prepare the necessary December 31, 2021, adjusting entries. Illustration 2A-1 Worksheet, Dress Right Clothing Corporation, July 31, 2021 D E F G H A 1 Worksheet, Dress Right Clothing Corporation, July 31, 2021 2 Unadjusted Trial Balance 3 Account Titles Dr. Cr. Adjusting Entries Dr. Cr. Adjusted Trial Balance Income Statement Dr. Cr. Dr. Cr. Balance Sheet Dr. Cr 800 68.500 2,000 2,000 24,000 38,000 12.000 (1) (2) 68,500 2,000 1200 22.000 38,000 12.000 68,500 2,000 1.200 22,000 38,000 12,000 2,000 200 250 0 35,000 40,000 1,000 (4) 0 0 60.0001 0 38,500 0 200 35,000 40,000 750 5,500 333 60.000 0 (5) (6) 5 Cash 6 Accounts receivable 7 Supplies 8 Prepaid Rent 9 Inventory 10 Office equipment 11 Accumulated depreciation 12 Accounts payable 13 Notes payable 14 Deferred rent revenue 15 Salaries payable 16 Interest payable 17 Common stock 18 Retained earnings 19 Sales revenue 20 Rent revenue 21 Cost of goods sold 22 Salaries expense 23 Supplies expense 24 Rent expense 25 Depreciation expense 26 Interest expense 27 Dividends 28 Totals 29 30 Net income 31 Totals 32 5,500 333 200 35,000 40,000 750 5.500 333 60,000 0 38,500 250 0 38.500 250 (4) 250 22.000 5,000 0 0 0 1,000 174.50,0 (5) 5,500 (1) 800 (2) 2,000 (3) ) 200 (6) 333 INT 22.000 10,500 800 2,000 200 333 1,000 180.533 22.000 10,500 800 2,000 200 333 1,000 174.5.00 9.083 9.08% 180.533 2917 38.750 2917 38.750 144.700 144.700 Sheet1