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Problem 2 adjusting journal entries vargas executive

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Problem 2:Adjusting Journal EntriesVargas Executive Search ServiceTrial BalanceDecember 31DebitCreditCash$1,713Prepaid Rent1,800Office Supplies413Office Equipment15,750Accounts Payable$ 3,173Income Tax Payable1,300Unearned Revenues1,823Common Stock10,000Dividends5,200Search Revenue20,140Utilities Expense1,260Wages Expense9,000Income Tax Expense1,300Totals$36,436$36,436Jose Vargas began his executive search firm on July 1.After six months of operation, Vargas wantedto know how his business was doing.Use the unadjusted trial balance and the information providedbelow to prepare adjusting entries for the following:(Note:For additional practice you can alsocreate the financial statements and closing entries.)1.One year’s rent had been paid in advance when Vargas began business.2.Inventory of unused office supplies, $75.3.The office equipment has an estimated useful life of 7 years and a salvage value of $3,150.The company uses straight-line depreciation.
A100 Final Exam Review84.Services earned that had been paid for in advance, $863.5.Executive search services rendered during the month but not yet billed, $270.6.Employee wages total $940 per week and are paid every Friday.December 31 falls onThursday.
A100 Final Exam Review9Adjusted Trial BalanceHillcrest Campgrounds, Inc. rents out campsites in a wooded park.The adjusted trial balance for HillcrestCampgrounds on March 31, 20X2, the end of the current fiscal year, follows:Hillcrest Campgrounds, Inc.Adjusted Trial BalanceMarch 31, 20X2DebitCreditCash$2,040Accounts Receivable3,660Supplies114Prepaid Insurance594Land15,000Building45,900Accumulated Depreciation, Building$10,500Accounts Payable1,725Income Tax Payable3,500Wages Payable825Common Stock30,000Retained earnings, 4/1/X116,535Dividends18,000Campsite Rental Revenue44,100Wages Expense11,925Income Tax Expense3,500Insurance Expense1,892Utilities Expense900Supplies Expense660Depreciation Expense:Buildings3,000Totals$107,185$107,185Required:Prepare the income statement, retained earnings statement and classified balance sheet for HillcrestCampgrounds, Inc. for the year ended March 31, 20X2.
A100 Final Exam Review10
A100 Final Exam Review11
A100 Final Exam Review12Challenge ProblemAn inexperienced accountant has put together a balance sheet for Art Objects, Inc.The balances shown are atSeptember 30.AssetsLiabilities and EquityCurrent assets:Current liabilities:Inventory$30,000Accounts receivable$Cash6,000Other long-term assets5,000Land28,000Salaries payable8,000Other current assets5,000Intangible assets35,000Interest receivable2,000Accounts payable4,000Total current assets71,000Total current liabilities54,000Accounts payable42,000Shareholders’ equity:Buildings (net)36,000Retained earnings52,000Equipment (net)18,000Common stock47,000Miscellaneous long-term assets6,000Short-term note payable20,000Total non-current assets102,000Total stockholder’s equity119,000Total assets$173,000Total liabilities and equity$173,000Required:a.Identify the errors in the balance sheet presented above.b.Using good form, prepare a corrected, classified balance sheet.2,000

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Term
Fall
Professor
Watkins
Tags
Balance Sheet, Fiscal Year, Generally Accepted Accounting Principles

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