The unadjusted trial balance of Best Laundry at March 31, 2008, the end of the current fiscal year, is shown below
|
Best Laundry Unadjusted Trial Balance March 31, 2008 |
||
|
|
Debit |
Credit |
|
|
Balances |
Balances |
|
Cash |
1,450 |
|
|
Laundry Supplies |
3,750 |
|
|
Prepaid Insurance |
2,400 |
|
|
Laundry Equipment |
54,500 |
|
|
Accumulated Depreciation |
|
20,500 |
|
Accounts Payable |
|
3,100 |
|
Ryan Boyle, Capital |
|
18,900 |
|
Ryan Boyle, Drawing |
1,000 |
|
|
Laundry Revenue |
|
82,500 |
|
Wages Expense |
35,750 |
|
|
Rent Expense |
18,000 |
|
|
Utilities Expense |
6,800 |
|
|
Miscellaneous Expense |
1,350 |
|
|
|
125,000 |
125,000 |
The data needed to determine year end adjustments are as follows:
a. Laundry supplies on hand at March 31 are $950.
b. Insurance premiums expired during the year are $2,000.
c. Depreciation of equipment during the year is $2,900.
d. Wages accrued but not paid at March 31 are $600.
Instructions
1. For each account listed in the unadjusted trial balance, enter the balance in a T account.
Identify the balance as “Mar. 31 Bal.” In addition, add T accounts for Wages Payable, Depreciation Expense, Laundry Supplies Expense, Insurance Expense, and Income Summary.
2. Optional: Enter the unadjusted trial balance on an end of period spreadsheet (work sheet) and complete the spreadsheet. Add the accounts listed in Part (1) as needed.
3. Journalize and post the adjusting entries. Identify the adjustments by “Adj.” and the new balances as “Adj. Bal.”
4. Prepare an adjusted trial balance.
5. Prepare an income statement, a statement of owner’s equity (no additional investments were made during the year), and a balance sheet.
6. Journalize and post the closing entries. Identify the closing entries by “Clos.”
7. Prepare a post closing trial balance.