The Great Graphics Group began operations on January 1, 2010. At the end of its second year of operations, and before any adjustments had been made, the trial balance was as follows:

Analysis reveals the following additional data for adjustments to be made:
1. There were $2,000 of supplies on hand at year end.
2. The note payable was issued on October 1, 2011. It is a nine-month note, with an interest rate of 9% per year. The interest does not have to be paid until July 1, 2012, when the note is due to be repaid.
3. The balance in the Prepaid Insurance account is the premium paid for a one-year policy that began March 1, 2011.
4. By year end, $4,500 of the amount recorded in the Unearned Consulting Fees account had been earned.
5. At year end, $3,000 of additional graphic design fees had been earned, but not yet billed or recorded. The work was completed in December 2011, and the clients will pay for it in January 2012.
6. The equipment was acquired on April 1, 2010, and is being amortized at a rate of $4,400 per year.
Required:
Calculate the amount that should appear (after adjustments) on the December 31, 2011, financial statements for each of the following items:
a. On the statement of earnings, related to supplies
b. On the statement of financial position, related to interest
c. On the statement of financial position, related to insurance
d. On the statement of earnings, related to consulting fees
e. On the statement of earnings, related to graphic design fees
f. On the statement of financial position, as the net book value of the equipment

Transcribed Image Text:

Debit balances Credit balances Accounts Receivable 13,500 on Unearned Consulting Fees Graphic Design Fees Revenue 3 nse $114,500