Prepare adjusted trial balance
E3 10 (adjusting entries) Uhura resort opened for business on June 1 with eight air conditioned units. Its trial balance on august 31 as follows.
|
UHURA RESORT TRIAL BALANCE 31 Aug 12 |
||
|
Debit |
Credit |
|
|
Cash |
$19,600 |
|
|
Prepaid Insurance |
4,500 |
|
|
Supplies |
2,600 |
|
|
Land |
20,000 |
|
|
Buildings |
120,000 |
|
|
Equipment |
16,000 |
|
|
Accounts Payable |
$4,500 |
|
|
Unearned Rent Revenue |
4,600 |
|
|
Mortgage Payable |
50,000 |
|
|
Common Stock |
100,000 |
|
|
Dividends |
5,000 |
|
|
Rent Revenue |
86,200 |
|
|
Salaries and Wages Expense |
44,800 |
|
|
Utilities Expenses |
9,200 |
|
|
Maintenance and Repairs Expense |
3,600 |
|
|
$245,300 |
$245,300 |
|
Other Data:
1. The balance in prepaid insurance is a one year premium paid on June 1, 2010.
2. An inventory count on August 31 shows $650 of supplies on hand.
3. Annual depreciation rates are cottages (4%) and furniture (10%). Salvage value is estimated to be 10% of cost.
4. Unearned rent revenue of $3,800 was earned prior to August 31.
5. Salaries of $375 were unpaid at August 31
6. Rentals of $800 were due from tenants at August 31.
7. The mortgage interest rate is 8% per year.
Instructions:
(a) Journalize the adjusting entries on August 31 for the 3 months period June 1 August 31. (omit explanation)
(b) Prepare an adjusting trial balance on August 31