Question

Required Information The following information applies to the questions displayed below.) On December 1 Year 1, John and Patty Driver formed a corporation called Susquehanna Equipment Rentals. The new corporation was able to begin operations immediately by purchasing the assets and taking over the location of Rent-it, an equipment rental company that was going out of business. The newly formed company uses the following accounts Cash Accounts Receivable Prepaid Rent Unexpired Insurance Office Supplies Rental Equipment Accumulated Depreciation: Rental Equipment Notes Payable Accounts Payable Interest Payable Capital Stock Retained Earnings Dividends Income Summary Rental Fees Earned Salaries Expense Maintenance Expense Utilities Expense Rent Expense Office Supplies Expense Depreciation Expense Interest Expense Income Taxes Expense Salaries Payable Dividends Payable Unearned Rental Fees Income Taxes Payable The corporation performs adjusting entries monthly Closing entries are performed annually on December 31. During December, the corporation entered into the following transactions Dec. 1 Issued to John and Patty Driver 20,000 shares of capital stock in exchange for a total of $280,000 cash. Dec. 1 Purchased for $201,600 all of the equipment formerly owned by Rent-It. Paid $136,000 cash and issued a 1-year note payable for 565,600. The note. plus all 13

Answer 1

Susquehanna Equipment Rental
Trial Balance
December 31, Year 1
Account Title	Debit	Credit
Cash	$      75,460.00
Capital Stock		$    200,000.00
Rental Equipment	$    199,500.00
Notes Payable		$      65,600.00
Prepaid Rent	$        7,000.00
Office Supplies	$            660.00
Accounts payable		$        2,270.00
Unearned Rental fees		$        4,600.00
Salaries Expenses	$        9,900.00
Rental fees earned		$      44,720.00
Account Receivable	$        9,220.00
Maintenance Expenses	$            700.00
Dividend	$        2,000.00
Dividend Payable		$        2,000.00
Unexpired Insurance	$        8,640.00
Utilities Expenses	$            670.00
Rent Expenses	$        3,500.00
Interest Expenses	$            328.00
Interest Payable		$            328.00
Depreciation	$        2,100.00
Supplies Expenses	$            940.00
Salaries Payable		$        1,100.00
Income taxes	$        9,832.80
Income tax payable		$        9,832.80
Total	$    330,450.80	$    330,450.80