Question

The trial balance of Goldsmith Inc. shown below pertains to December 31, 2020, which is the end of its fiscal year. D $ 198 370 6 100 $ 40 250 130 380 Goldsmith Inc. Trial Balance December 31, 2020 (in thousands of dollars) Cash Accrued service revenue Supplies Fumiture and fixtures Accumulated depreciation—furniture and fixtures Building Accumulated depreciation—building Accounts payable Salary payable Unearned service revenue Income tax payable Share capital Retained earnings Dividends Service revenue Salary expense Supplies expense Depreciation expense-furniture and fixtures Depreciation expense-building Income tax expense Miscellaneous expense Total 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 45 100 193 286 172 13 $ 1.174 $1,174

Answer 1

Goldsmith Inc. (in thousands of $) Debit in $ Credit in $ Adjusting Enteries Date Particulars 31.12.2020 Supplies Expense a/c Dr. To Supplies (Supplies expensed) 6 - 2 =4 20 31.12.2020 Depreciation Expense - Furn.& Fix.a/c Dr. To Accum. Depreciation - Furn. & Fix. (To record depreciation) 20 10 31.12.2020 Depreciation Expense - Build a/c Dr. To Accum. Depreciation - Build. (To record depreciation) 10 Dr. 31.12.2020 Salary Expense a/c To Salary Payable (Salary accrued) Dr. 31.12.2020 Accrued Service Revenue a/c To Service Revenue (Revenue accrued) 12 Dr. 32 31.12.2020 Unearned Service Revenue a/c To Service Revenue (Revenue earned) 32 31.12.2020 Income Tax Expense a/c To Income Tax Payable (Income tax accrued) 35 Closing Enteries Date Particulars Debit in $ Credit in $ 31.12.2020 Income Summary a/c Dr. 259 To Salary Expense 177 To Supplies Expense 4 To Depreciation Expense - Furn.& Fix. To Depreciation Expense - Build To Income Tax Expense To Miscellaneous Expense (Expense accounts closed) Dr. 330 31.12.2020 Service Revenue a/c To Income Summary (Revenue accounts closed) 330 Dr. 71 31.12.2020 Income Summary a/c To Retained Earnings (Profits transferred) 71 Dr. 31.12.2020 Retained Earnings a/c To Dividends (Dividends charged) 65

6 Worksheet For the period ending 31.12.2020 Unadjusted Adjustments Adjusted Post Closing Particulars Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ Debit in $ Credit in $ Cash 198 198 198 Accrued Service Revenue 370 12 382 382 Supplies 2 Furniture & Fixtures 100 100 100 Accum. Depreciation - Furn. & Fix. 40 60 Building 250 250 250 Accum. Depreciation - Build. 130 Accounts Payable 380 Salary Payable Unearned Service Revenue 32 Income Tax Payable Share Capital 100 100 Retained Earnings 193 193 199 Dividends Service Revenue 286 330 Salary Expense 172 Supplies Expense Depreciation Expense - Furn.& Fix. Depreciation Expense - Build Income Tax Expense Miscellaneous Expense Totals 1174 1174 118 118 1256 1256 932 932 44

330 Statement of Income For the period ending 31.12.2020 Service Revenue Less: Salary Expense Supplies Expense Depreciation Expense - Furn.& Fix. Depreciation Expense - Build Miscellaneous Expense 224 106 -35 Income Tax Expense Net Income Statement of Retained Earnings For the period ending 31.12.2020 Beginning Balance Add:Net Income Less:Dividends -65 199

Amounts in $ Amounts in $ Balance sheet As at 31.12.2020 Assets Current Assets Cash Accrued Service Revenue Supplies 198 Amounts in $ Amounts in $ Liabilities Current Liabilities Accounts Payable 382 Salary Payable 582 Unearned Service Revenue Income Tax Payable 380 35 433 Non Current Assets Furniture & Fixtures Accum. Depreciation - Furn. & Fix. Building Accum. Depreciation - Build. Total Assets 100 -60 250 -140 40 Shareholders Equity Contributed Capital 110 Retained Earnings 732 Total Liabilities & Equity 100 199 299 732