Using Financial Reports: Inferring Adjusting Entries and Information Used in Computations and Recording Closing Entries
The pre-closing balances in the T-accounts of Waldman Company at the end of the third year of operations, December 31, 2011, follow. The 2011 adjusting entries are identified by letters.

Required:
1. Develop three 2011 trial balances for Waldman Company using the following format:

2. Write an explanation for each adjusting entry for 2011.
3. Record the closing journal entry at the end of 2011.
4. What was the average income tax rate for 2011?
5. What was the average issue (sale) price per share of the capitalstock?

Contributed Capital (10,000 shares) Bal. 50,000 Note Payable (8%) Cash Bal. 10,000 Bal. 20,000 Maintenance Supplies Retained Earnings Interest Payable Bal. 9,000 (b) 500 (a) 800 Bal. 300 Income Taxes Payable Service Equipment Service Revenue (f) 13,020 Bal. 90,000 Bal. 214,000 (c) 6,000 Accumulated Depreciation, Service Equipment Bal. 18,000 9,000 Expenses Wages Payable Bal. 160,000 (a) (b) (e) 500 (d) 300 800 (d) 9,000 Unearned Revenue Remaining Assets (e) (f) 500 (c) 6,000 Bal. 12,000 Bal. 42,500 13,020