Question

Sheridan Resort opened for business on June 1 with eight air-conditioned units. Its trial balance on August 31 is as follows.

SHERIDAN RESORT TRIAL BALANCE AUGUST 31, 2020
		Debit			Credit
Cash		$21,700
Prepaid Insurance		6,600
Supplies		4,700
Land		24,000
Buildings		124,000
Equipment		20,000
Accounts Payable					$6,600
Unearned Rent Revenue					6,700
Mortgage Payable					64,000
Common Stock					97,100
Retained Earnings					9,000
Dividends		5,000
Rent Revenue					80,200
Salaries and Wages Expense		44,800
Utilities Expenses		9,200
Maintenance and Repairs Expense		3,600
		$263,600			$263,600

Other data:

1.		The balance in prepaid insurance is a one-year premium paid on June 1, 2020.
2.		An inventory count on August 31 shows $459 of supplies on hand.
3.		Annual depreciation rates are (a) buildings (4%) (b) equipment (10%). Salvage value is estimated to be 10% of cost.
4.		Unearned Rent Revenue of $3,760 was earned prior to August 31.
5.		Salaries of $359 were unpaid at August 31.
6.		Rentals of $843 were due from tenants at August 31. (Use Accounts Receivable account.)
7.		The mortgage interest rate is 8% per year.

. Prepare an adjusted trial balance on August 31.

Answer 1

21700 843 4950 459 24000 124000 20000 1116 450 359 SHERIDAN RESORT Cash Accounts payable Prepaid Insurance Supplies Land Buildings Equipment Accumulated Depreciation - Building Accumulated Depreciation - Equipment Salaries and Wages payable Interest payable Accounts payable Unearned Rent Revenue Mortgage payable Common Stock Retained earnings Dividends Rent Revenue Salaries and wages expense Insurance Expense Supplies Expense Depreciation Expense - Building Depreciation Expense - Equipment Utilities Expense Maintenance and Repairs Expense Interest Expense 1280 6600 2940 64000 97100 9000 5000 84803 45159 1650 4241 1116 450 9200 3600 1280 267648 267648

Workings:

Journal entries prepared:

1) 1650 Insurance Expense Prepaid Insurance (Being insurance expense expired) 1650 2) Supplies Expense Supplies (To record supplies expense incurred) 4241 3) 1116 Depreciation Expense - Building Accumulated Depreciation - Building (To record depreciation expense) 1116 4) 450 Depreciation Expense - Equipment Accumulated Depreciation - Equipment (To record depreciation expense) 450 5) 3760 Unearned Rent Revenue Rent Revenue (To record rent revenue earned) 3760 6) 359 Salaries and Wages Expense Salaries and Wages Payable (To record salaries due) 359 7) 843 Accounts Receivable Rent Revenue (To record rent accrued) 843 8) 1280 Interest Expense Interest Payable (To record Interest expense due) 1280