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Cr dr cr dr cr cash 3950 accounts receivable supplies

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Dr. Cr. Dr. Cr. Dr. Cr. Cash 3,950 Accounts receivable - Supplies 9,720 Prepaid insurance 2,400 Equipment 26,000 Accum. depr. - Equip. - Accounts payable 6,200 Salaries payable - Unearned revenue 3,000 Common Stock 30,000 Retained Earnings 0 Dividends 600 Consulting revenue 5,800 Rental revenue 300 Depr. expense - Salaries expense 1,400 Insurance expense - Rent expense 1,000 Supplies expense - Utilities expense 230 Totals 45,300 45,300 Trial Balance Adjustments Trial Balance First, the initial unadjusted amounts are added to the work sheet. $ 3-22
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Dr. Cr. Dr. Cr. Dr. Cr. Cash 3,950 Accounts receivable - f 1,800 Supplies 9,720 b 1,050 Prepaid insurance 2,400 a 100 Equipment 26,000 Accum. depr. - Equip. - c 375 Accounts payable 6,200 Salaries payable - e 210 Unearned revenue 3,000 d 250 Common Stock 30,000 Retained Earnings 0 Dividends 600 Consulting revenue 5,800 d 250 f 1,800 Rental revenue 300 Depr. expense - c 375 Salaries expense 1,400 e 210 Insurance expense - a 100 Rent expense 1,000 Supplies expense - b 1,050 Utilities expense 230 Totals $45,300 $45,300 $3,785 $3,785 Adjusted Trial Balance Adjustments Unadjusted Trial Balance Next, FastForward’s adjustments are added. FastForward Recording Adjustments Trial Balance - December 31, 2011 3-23
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Dr. Cr. Dr. Cr. Dr. Cr. Cash 3,950 3,950 Accounts receivable - f 1,800 1,800 Supplies 9,720 b 1,050 8,670 Prepaid insurance 2,400 a 100 2,300 Equipment 26,000 26,000 Accum. depr. - Equip. - c 375 375 Accounts payable 6,200 6,200 Salaries payable - e 210 210 Unearned revenue 3,000 d 250 2,750 Common Stock 30,000 - 30,000 Retained Earnings - - Dividends 600 600 Consulting revenue 5,800 d 250 7,850 f 1,800 Rental revenue 300 300 Depr. expense - c 375 375 Salaries expense 1,400 e 210 1,610 Insurance expense - a 100 100 Rent expense 1,000 1,000 Supplies expense - b 1,050 1,050 Utilities expense 230 230 Totals $45,300 $45,300 $3,785 $3,785 $47,685 $47,685 Adjusted Trial Balance Adjustments Unadjusted Trial Balance Finally, the totals are determined. FastForward Computing the Adjusted Trial Balance - December 31, 2011 3-24
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FastForward Income Statement For the Month Ended December 31, 2011 Revenues: Consulting revenue 7,850 $ Rental revenue 300 Operating expenses: Depr. expense - Equip. 375 $ Salaries expense 1,610 Insurance expense 100 Rent expense 1,000 Supplies expense 1,050 Utilities expense 230 Total expenses 4,365 Net income 3,785 $ 1. Prepare Income Statement Dr. Cr. Cash 3,950 $ Accounts receivable 1,800 Supplies 8,670 Prepaid insurance 2,300 Equipment 26,000 Accum. depr. - Equip. 375 $ Accounts payable 6,200 Salaries payable 210 Unearned revenue 2,750 Common Stock 30,000 Retained Earnings - Dividends 600 Consulting revenue 7,850 Rental revenue 300 Depr. expense 375 Salaries expense 1,610 Insurance expense 100 Rent expense 1,000 Supplies expense 1,050 Utilities expense 230 Totals 47,685 $ 47,685 $ Adjusted December 31, 2011 Trial Balance 3-25
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2. Prepare Statement of Retained Earnings FastForward Income Statement For the Month Ended December 31, 2011 Revenues: Consulting revenue 7,850 $ Rental revenue 300 Total Revenues 8,150 Operating expenses: Depr. expense - Equip. 375 $ Salaries expense 1,610 Insurance expense 100 Rent expense 1,000 Supplies expense 1,050 Utilities expense 230 Total expenses 4,365 Net income 3,785 $ FastForward Statement of Retained Earnings For the Month Ended December 31, 2011 Retained earnings, 12/1/11 $ -0- Add: Net income 3,785 Less: Dividends 600 Retained earnings 12/31/11 3,185 $ Note that net income from the Income Statement carries to the Statement of Retained Earnings.
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