Question

Is this an adjusted trial balance or is it the trial balance before the adjustments? How can you tell the difference? If it is unadjusted, what adjustments need to be made? the transactions for that trial balance are on the following three pages.

Credit Debit 831,000 303,000 40,600 225,000 200,000 1,875,000 215,000 Trial Balance Account Cash Accounts Receivable Allowance for Doubtful Accounts Prepaid Rent Prepaid Insurance Inventory Furniture & Fixtures Accumulated Depreciation Accounts Payable Wages Payable Common Stock Retained Earnings Sales Revenue Cost of Goods Sold Wages Expense Rent Expense Depreciation Expense Utility Expense Bad Debt Expense Insurance Expense Dividends 106,000 540,000 75,000 1,200,000 595,000 11,200,000 4,000,000 1,210,000 300,000 21,000 100,000 46,600 430,000 4,000,000 Totals 13,756,600 13,756,600

Answer 1

	It is adjusted trial balance
	1.Allowance for doubtful accounts is adjusted	$40,600
	2.Dividends are adjusted	$4,000,000
	3.Depreciation expenses adjusted	$21,000
	4. Insurance expense is adjusted	$430,000	(5/12)*360000+(7/12)*480000
	5. Rent expense(Operating Lease is adjusted	$300,000	(6/12)*600000
	6. Wages Payable at year end is adjusted	$75,000
	INCOME STATEMENT
	Sales Revenue	$11,200,000
	Cost of goods sold	$4,000,000
	Gross Profit		$7,200,000
	Operating Expenses
	Wages expense	$1,210,000
	Rent expense	$300,000
	Depreciation expense	$21,000
	Utility expense	$100,000
	Bad Debt Expense	$46,600
	Insurance Expense	$430,000
	Total Operating Expenses		$2,107,600
	Net Income		$5,092,400
	STATEMENT OF RETAINED EARNINGS
	Retained Earnings at the beginning of the year	$595,000
	Add: Net Income	$5,092,400
	Less:Dividends	$4,000,000
	Retained Earnings at the End of the year	$1,687,400
	BALANCE SHEET
	Assets:
	Cash	$831,000
	Accounts Receivable(Net)	$262,400	(303000-40600)
	Prepaid Rent	$225,000
	Prepaid Insurance	$200,000
	Inventory	$1,875,000
	Furniture and Fixtures	$215,000
	Accumulated Depreciation	($106,000)
	Total Assets	$3,502,400
	LIABILITIES & EQUITY
	Accounts Payable	$540,000
	Wages Payable	$75,000
	Total Liabilities	$615,000
	Common Stock	$1,200,000
	Retained Earning	$1,687,400
	Total Equities	$2,887,400
	Total Liabilities and Equity	$3,502,400