Unadjusted Trial balance, December 31, 2012.
(in thousands of dollars)
Accounts receivable 100
Notes receivable 50
Merchandise inventory 120
Prepaid rent 12
Accumulated depreciation 20
Accounts payable 130
Paid in capital 100
Retained income 67
Cost of goods sold 460
Wages expense 200
Miscellaneous expenses 120
Income tax expense 25
Total 1197 1197
The following additional information is not reflected in the trial balance
a. Interest accrued on notes receivable $5
b. Depreciation $10
c. Wages accrued but unpaid $6
d. Utilities accrued but unpaid $4( charge miscellaneous expenses).
e. Rent expired 5$
f. Dividend declared but unpaid $12. Use a dividends declared account, which is really just a offset to retained income.
g. A cash receipt of $2 from a credit customer was credited erroneously to accounts payable, so a correction must be made.
h. Additional income tax expense must be accrued. The income tax rate is 40%of pretax income. Compute the additional tax after computing the effects of the above adjustments to revenue and expense accounts.
Prepare adjusted trial balance and financial statements.
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