Maquoketa Valley Resort opened for business on June 1 with

P4-3B Maquoketa Valley Resort opened for business on June 1 with eight air-conditioned units. Its trial balance before adjustment on August 31 is presented here.

MAQUOKETA VALLEY RESORT

Trial Balance August 31, 2012;

Debit Credit Cash $ 24,600

Prepaid Insurance 5,400

Supplies 4,300

Land 40,000

Buildings 132,000

Equipment 36,000

Accounts Payable $ 6,500

Unearned Rent Revenue 6,800

Mortgage Payable 120,000

Common Stock 100,000

Dividends 5,000

Rent Revenue 80,000

Salaries and Wages Expense 53,000

Utilities Expense 9,400

Maintenance and Repairs Expense 3,600 $313,300 $313,300;

Other data:

1. Insurance expires at the rate of $450 per month.

2. A count of supplies on August 31 shows $700 of supplies on hand.

3. Annual depreciation is $6,600 on buildings and $4,000 on equipment.

4. Unearned rent of $5,000 was earned prior to August 31.

5. Salaries of $600 were unpaid at August 31.

6. Rentals of $1,600 were due from tenants at August 31. (Use Accounts Receivable.)

7. The mortgage interest rate is 9% per year. (The mortgage was taken out August 1.)

Instructions

(a) Journalize the adjusting entries on August 31 for the 3-month period June 1? August 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 August 31.

(d) Prepare an income statement and a retained earnings statement for the 3 months ended August 31 and a classified balance sheet as of August 31.

(e) Identify which accounts should be closed on August 31.

TUTORIAL PREVIEW

GENERAL JOURNAL
ACCOUNT TITLE AND EXPLANATION		DEBIT	CREDIT
Insurance Expense ($450 x 3)		1,350
Prepaid Expense			1,350
Supplies Expense		3,600

 File name P4-3B Maquoketa Valley Resort.xlsx   File type: .xlsx     PRICE:$15