This problem continues the Canyon Canoe Company situation from Chapter 2. You will need to use the unadjusted trial balance and posted T-accounts.

At December 31, the business gathers the following information for the adjusting entries:

a. Office supplies on hand, $165

b. Rent of one month has been used.

c. Determine the depreciation on the building using straight-line depreciation.

Assume the useful life of the building is five years and the residual value is $5,000.

d. $400 of unearned revenue has now been earned.

e. The employee who has been working the rental booth has earned $1,250 in wages that will be paid January 15, 2019.

f. Canyon Canoes has earned $1,850 of canoe rental revenue that has not been recorded or received.

g. Determine the depreciation on the canoes purchased on November 3 using straight-line depreciation. Assume the useful life of the canoes is 4 years and the residual value is $0.

h. Determine the depreciation on the canoes purchased on December 2 using straight-line depreciation. Assume the useful life of the canoes is 4 years and the residual value is $0.

i. Interest expense accrued on the notes payable, $50.

Requirements

1. Journalize and post the adjusting entries using the T-accounts that you completed in Chapter 2. In the T-accounts, denote each adjusting amount as Adj. and an account balance as Balance.

2. Prepare an adjusted trial balance as of December 31, 2018.