Mason Advertising Agency was founded in January 2008.
Presented below are adjusted and unadjusted trial balances as of December 31,
2012.
P3-2 Mason
Advertising Agency was founded in January 2008. Presented below are adjusted
and unadjusted trial balances as of December 31, 2012.
MASON ADVERTISING AGENCY
Trial
Balance
December
31, 2014
|
Unadjusted
|
Adjusted
|
|||
|
Debit
|
Credit
|
Debit
|
Credit
|
|
|
Cash
|
$11,000
|
|
$11,000
|
|
|
Accounts Receivable
|
20,000
|
|
23,500
|
|
|
Supplies
|
8,400
|
|
3,000
|
|
|
Prepaid Insurance
|
3,350
|
|
2,500
|
|
|
Equipment
|
60,000
|
|
60,000
|
|
|
Accumulated
Depreciation - Equipment
|
|
$28,000
|
|
$33,000
|
|
Accounts Payable
|
|
5,000
|
|
5,000
|
|
Interest Payable
|
|
0
|
|
150
|
|
Notes Payable
|
|
5,000
|
|
5,000
|
|
Unearned Service
Revenue
|
|
7,000
|
|
5,600
|
|
Salaries and Wages
Payable
|
|
0
|
|
1,300
|
|
Common Stock
|
|
10,000
|
|
10,000
|
|
Retained Earnings
|
|
3,500
|
|
3,500
|
|
Service Revenue
|
|
58,600
|
|
63,500
|
|
Salaries and Wages
Expense
|
10,000
|
|
11,300
|
|
|
Insurance Expense
|
|
|
850
|
|
|
Interest Expense
|
350
|
|
500
|
|
|
Depreciation Expense
|
|
|
5,000
|
|
|
Supplies Expense
|
|
|
5,400
|
|
|
Rent Expense
|
4,000
|
|
4,000
|
|
|
Totals:
|
$117,100
|
$117,100
|
$127,050
|
$127,050
|
Instructions
(a)
Journalize the annual adjusting entries that were made. (Omit explanations.)
(b)
Prepare an income statement and a statement of retained earnings for the year
ending December 31, 2014 and an unclassified balance sheet at December 31.
(c)
Answer the following questions:
(1) If
the note has been outstanding 3 months, what is the annual interest rate on
that note?
|
Enter text answer here.
|
(2) If
the company paid $12,500 in salaries and wages in 2014, what was the balance in
Salaries and Wages Payable on December 31, 2013
|
Enter text answer here.
|
TUTORIAL
PREVIEW
Instructions
(a)
Journalize the annual adjusting entries that were made. (Omit explanations.)
|
Dec 31
|
Accounts Receivable
|
3,500
|
||
|
Service Revenue
|
3,500
|
|||
|
Dec 31
|
Unearned Service
Revenue
|
1,400
|
||
|
Service Revenue
|
1,400
|
|||
