Law Management Services began business on January 1, 2012, with a capital investment of $120,000. The company manages condominiums for owners (Service Revenue) and rents space in its own office building (Rent Revenue). The trial balance and adjusted trial balance columns of the worksheet at the end of the year are as follows.
|
LAW MANAGEMENT SERVICES |
||||
|
Worksheet |
||||
|
For the Year Ended December 31, 2012 |
||||
|
Adjusted |
||||
|
Trial Balance |
Trial Balance |
|||
|
Account Titles |
Dr. |
Cr. |
Dr. |
Cr. |
|
Cash |
13,800 |
13,800 |
||
|
Accounts Receivable |
28,300 |
28,300 |
||
|
Prepaid Insurance |
3,600 |
2,400 |
||
|
Land |
67,000 |
67,000 |
||
|
Buildings |
127,000 |
127,000 |
||
|
Equipment |
59,000 |
59,000 |
||
|
Accounts Payable |
12,500 |
12,500 |
||
|
Unearned Rent Revenue |
6,000 |
1,500 |
||
|
Mortgage Payable |
120,000 |
120,000 |
||
|
Owner’s Capital |
144,000 |
144,000 |
||
|
Owner’s Drawings |
22,000 |
22,000 |
||
|
Service Revenue |
90,700 |
90,700 |
||
|
Rent Revenue |
29,000 |
33,500 |
||
|
Salaries and Wages Expense |
42,000 |
42,000 |
||
|
Advertising Expense |
20,500 |
20,500 |
||
|
Utilities Expense |
19,000 |
19,000 |
||
|
Totals |
402,200 |
402,200 |
||
|
Insurance Expense |
1,200 |
|||
|
Depreciation Expense |
6,600 |
|||
|
Accumulated Depreciation—Buildings |
3,000 |
|||
|
Accumulated Depreciation—Equipment |
3,600 |
|||
|
Interest Expense |
10,000 |
|||
|
Interest Payable |
10,000 |
|||
|
Totals |
418,800 |
418,800 |
||
Instructions
(a) Prepare a complete worksheet.
(b) Prepare a classified balance sheet.
(c) Journalize the adjusting entries.
(d) Journalize the closing entries.
(e) Prepare a post closing trial balance.