2010-06-19_202703_Kunde - *P3-9 (Adjusting and Closing)...

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Unformatted text preview: *P3-9 (Adjusting and Closing) Presented below is the December 31 trial balance of Nancy Drew Boutique. NANCY DREW BOUTIQUE TRIAL BALANCE DECEMBER 31 Debit Credit Cash $ 18,500 Accounts Receivable 42,000 Allowance for Doubtful Accounts $ 700 Inventory, December 31 80,000 Prepaid Insurance 5,100 Furniture and Equipment 84,000 Accumulated DepreciationFurniture and Equipment 35,000 Notes Payable 28,000 Common Stock 80,600 Retained Earnings 10,000 Sales 600,000 Cost of Goods Sold 398,000 Sales Salaries Expense 50,000 Advertising Expense 6,700 Administrative Salaries Expense 65,000 Office Expense 5,000 $754,300 $754,300 Instructions (a) Construct T-accounts and enter the balances shown. (b) Prepare adjusting journal entries for the following and post to the T-accounts. (Omit explanations.) Open additional T-accounts as necessary. (The books are closed yearly on December 31.) (1) Bad debts are estimated to be $1,400. (2) Furniture and equipment is depreciated based on a 6-year life (no salvage value). (3) Insurance expired during the year $2,550. (4) Interest accrued on notes payable $3,360....
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2010-06-19_202703_Kunde - *P3-9 (Adjusting and Closing)...

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