Problem - Top Shelf Lard Inc. provides you with the following listing of pre-adjustment account balances as of December 31, 2014.
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Debit
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Credit
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Cash
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$ 6,000
|
|
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Accounts Receivable
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2,200
|
|
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Office Supplies
|
1,800
|
|
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Prepaid Insurance
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2,500
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|
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Office Equipment
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15,000
|
|
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Accumulated Depreciation-Office Equipment
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$ 4,000
|
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Accounts Payable
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|
4,000
|
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Unearned Service Revenue
|
|
4,000
|
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Common Stock
|
|
12,000
|
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Retained Earnings
|
|
4,400
|
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Dividends
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2,500
|
|
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Service Revenue
|
|
3,500
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Wage Expense
|
1,900
|
|
|
Additional information for adjusting entries:
|
$31,900
|
$31,900
|
Additional information for adjusting entries:
1. A count of office supplies indicates $1,200 of supplies on hand at the end of the year.
2. Office equipment is depreciated straight-line over a ten year period.
3. Additional wages of $600 were incurred, but have not yet paid.
4. The prepaid insurance pertains to a 5-month insurance policy. Coverage began on December 1, 2014.
5. A cash advance received from a customer was recorded as unearned revenue. As of the end of the year, three-fourths of the services promised under the contract have been provided.
Prepare adjusting journal entries, closing journal entries, an income statement for 2014, and a balance sheet as of December 31, 2014.