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The general ledger of the Karlin Company, a consulting company, at January 1, 2013, contained the following account balances: |
| Account Title | Debits | Credits |
| Cash | 30,000 | |
| Accounts receivable | 15,000 | |
| Equipment | 20,000 | |
| Accumulated depreciation | 6,000 | |
| Salaries payable | 9,000 | |
| Common stock | 40,500 | |
| Retained earnings | 9,500 | |
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| Total | 65,000 | 65,000 |
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The following is a summary of the transactions for the year:
| a. | Sales of services, $100,000, of which $30,000 was on credit. |
| b. | Collected on accounts receivable, $27,300. |
| c. | Issued shares of common stock in exchange for $10,000 in cash. |
| d. | Paid salaries, $50,000 (of which $9,000 was for salaries payable). |
| e. | Paid miscellaneous expenses, $24,000. |
| f. | Purchased equipment for $15,000 in cash. |
| g. | Paid $2,500 in cash dividends to shareholders. |
| 1. | Accrued salaries at year end amounted to $1,000. |
| 2. | Depreciation for the year on the equipment is $2,000. |
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General journal entry for each of the summary transactions listed above. a.Cash (Dr.) 70000 Service revenue (Cr.) 100000 b.Cash (Dr.) 27300 c. Cash (Dr.) 10000 d. Salary expense (Dr.) 41000 e. Miscellaneous expense (Dr.) 24000 f. Equipment (Dr.) 15000 g. Retained Earning (Dr.) 2500 h..Salaries expense (Dr.) 1000 i. Depreciation expense equipment (Dr.) 2000
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| Required: |
| 1. |
Prepare the adjusting journal entries. |
| 2. |
Prepare the closing entries. |
| 3. |
Post the opening balances, transactions, adjusting and closing entries into the appropriate t accounts. |
| 4. | Prepare an unadjusted trial balance. |
| 5. |
Prepare an adjusted trial balance. |
| 6. |
Prepare an income statement for 2013. |
| 7. |
Prepare a balance sheet as of December 31, 2013. |
8. Prepare a post closing trial balance.