Question

Part 2:

The following unadjusted trial balance is for Groenke Construction Company as of year-end for the December 31, 20x7 fiscal year. The December 31, 20x6 credit balance of the stockholders’ equity account is $50,500, and the stockholders invested $45,000 cash in the company during 20x7.

1. Account Title Debit                     Credit

101         Cash                                                      $15,000

126         Supplies                                               $8,500

128         Pre-paid insurance                          $11,200

167         Equipment                                          $175,000

168         Accumulated depreciation – equipment                 $19,000

201         Accounts payable                                                               $9,250

251         Long-term notes payable                                               $45,000

301         Shareholders’ equity                                                      $106,900

302         Dividends                                            $15,750

401         Construction Revenue                                                   $153,000

623         Wage expense                                  $61,800

633         Interest expense                               $6,250

640         Rent expense                                    $15,750

683         Property tax expense                    $12,500

684         Repairs expense                                $6,100

690         Utilities expense                                $5,300

TOTALS                                                            $333,150                  $333,150

Instructions:

Use the template provided to:

1. Journalize the following adjusting entries as of fiscal year-end December 31, 20x7.
2. Post the adjusting entries to an unadjusted trial balance and prepare the adjusted trial balance.
3. Create financial statements, namely: i) the income statement, ii) statement of stockholders’ equity, and iii) the balance sheet for 20x7.

Adjustments needed:

1. The supplies available at the end of the fiscal year 20x7 are at a cost of $5,700.
2. The company's employees have earned $3.500 in accrued wages for the fiscal year.
3. The cost of expired insurance for the fiscal year is $8,600.
4. The rent expense not yet paid or recorded in the fiscal year is $2,250.
5. Annual depreciation on equipment is $8,000; no other depreciation adjustment was made in 20x7.
6. The $450 accrued interest for December has not yet been paid and reported.
7. Additional property taxes of $625 have been assessed for the fiscal year but have not yet been paid or recorded in the accounts.
8. The December utilities expense of $425 is not included in the adjusted trial balance, because the bill arrived after the trial balance was prepared. The $425 amount owed needs to be recorded.
   ACT300 Principles of Accounting l Module 8: Portfolio Project Template Option #1. Part 2 Groenke Construction Compang BE SURE TO CREATE A FINANCIAL STATEMENTS FROM TH Groenke Construction Co, Adjustments December 31, 20X7 Adjust ICompany Namel Income Statement [date] Debit Credit List names Expenses: List names Total expenses Net income Groenke Construction Co. Adjustments December 31. 20X7 adjusted Trial Bala Adjustments usted Trial Bala Acct # Account Names Debit $15,000 $8,500 $11,200 175,000 01 Cash 126 Supplies 12 Prepaid insurance 167 Equipment 168 Accumulated depreciation equipment 201 Accounts pa 251 Long-term notes payable 301 Stockholders' equity 302 Dividends ICompany Namel Statement of Stockholders Equity [datel $19,000 $9.250 $45,000 $106,900 $15,750 Stockholders' Equity, [date]
   

Answer 1

	Unadjusted Trial Balance		Adjustments		Adjusted Trial Balance
Account Name	Debit	Credit	Debit	Credit	Debit	Credit
Cash	15000				15000
Supplies	8500			2800	5700
Prepaid insurance	11200			8600	2600
Equipment	175000				175000
Accumulated depreciation-Equipment		19000		8000		27000
Accounts payable		9250				9250
Long term notes payable		45000				45000
Stockholders' equity		106900				106900
Dividends	15750				15750
Construction revenue		153000				153000
Wage expense	61800		3500		65300
Interest expense	6250		450		6700
Rent expense	15750		2250		18000
Property tax expense	12500		625		13125
Repairs expense	6100				6100
Utilities expense	5300		425		5725
Supplies expense			2800		2800
Insurance expense			8600		8600
Depreciation expense-equipment			8000		8000
Wages payable				3500		3500
Rent payable				2250		2250
Interest payable				450		450
Property tax payable				625		625
Utilities payable				425		425
Total	333150	333150	26650	26650	348400	348400
INCOME STATEMENT
Revenues:
Construction revenue		153000
Expenses:
Wage expense	65300
Interest expense	6700
Rent expense	18000
Property tax expense	13125
Repairs expense	6100
Utilities expense	5725
Supplies expense	2800
Insurance expense	8600
Depreciation expense-equipment	8000
Total expenses		134350
Net income		18650
STATEMENT OF STOCKHOLDERS' EQUITY
Stockholders' equity, January 1, 2017		61900
Add:
Additional shareholder investment	45000
Net income	18650	63650
		125550
Less: Dividends		15750
Stockholders' equity, December 31, 2017		109800
BALANCE SHEET
ASSETS
Current Assets:
Cash	15000
Supplies	5700
Prepaid insurance	2600
Total current assets		23300
Non-Current Assets:
Equipment	175000
Accumulated depreciation-Equipment	27000
Total non current assets		148000
Total assets		171300
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	9250
Wages payable	3500
Rent payable	2250
Interest payable	450
Property tax payable	625
Utilities payable	425
Total current liabilities		16500
Long term notes payable		45000
Total liabilities		61500
Stockholders' equity		109800
Total liabilities and stockholders equity		171300