The adjusted trial balance for Audio Concepts at December 31, 2011 is as follows (amounts are presented at their normal balance):
Cash 15,000
Accounts Receivable 7,000
Inventory 19,000
Supplies 4,000
Prepaid Insurance 6,000
Audio Equipment 190,000
Accumulated Depreciation Audio Equipment 29,000
Accounts Payable 19,000
Note Payable 70,000
Salaries Payable 3,000
Common Stock 20,000
Retained Earnings 92,000
Dividends 14,000
Audio Revenue 122,000
Interest Revenue 1,000
Cost of Goods Sold 21,000
Depreciation Expense 12,000
Insurance Expense 3,000
Rent Expense 17,000
Salaries Expense 42,000
Supplies Expense 6,000
Required:
1. Create T-accounts for all accounts provided above. Prepare the closing journal entries required, post them to the T-accounts, and prepare a post-closing trial balance at December 31, 2011.
2. Prepare a Statement of Retained Earnings in proper format for Audio Concepts at December 31, 2011.
3. In a brief statement, correlate the results of the above two requirements.