# View the step-by-step solution to: The Vang Hotel opened for business on May 1,

The Vang Hotel opened for business on May 1, 2012
ACCOUNTING

ACC 290 Week 3 Assignment

P4-3A The Vang Hotel opened for business on May 1, 2012. Here is its trial balance before adjustment on May 31.

VANG HOTEL
Trial Balance
May 31, 2012
Debit Credit
Cash \$ 2,500
Prepaid Insurance 1,800
Supplies 2,600
Land 15,000
Buildings 70,000
Equipment 16,800
Accounts Payable \$ 4,700
Unearned Rent Revenue 3,300
Mortgage Payable 36,000
Common Stock 60,000
Rent Revenue 9,000
Salaries and Wages Expense 3,000
Utilities Expense 800
\$113,000 \$113,000

Other data:
1. Insurance expires at the rate of \$450 per month.
2. A count of supplies shows \$1,050 of unused supplies on May 31.
3. Annual depreciation is \$3,600 on the building and \$3,000 on equipment.
4. The mortgage interest rate is 6%. (The mortgage was taken out on May 1.)
5. Unearned rent of \$2,500 has been earned.
6. Salaries of \$900 are accrued and unpaid at May 31.

Instructions
(a) Journalize the adjusting entries on May 31.
(b) Prepare a ledger using T accounts. Enter the trial balance amounts and post the adjusting entries.
(c) Prepare an adjusted trial balance on May 31.
(d) Prepare an income statement and a retained earnings statement for the month of May and a classified balance sheet at May 31.
(e) Identify which accounts should be closed on May 31.

Question:
The Vang Hotel opened for business on May 1, 2012. Here is its trial balance before adjustment on
May 31.
VANG HOTEL
Trial Balance
May 31, 2012
Debit Credit
Cash \$ 2,500
Prepaid Insurance...

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