Question

Oriole was founded in January 2013. Presented below are adjusted and unadjusted trial balances as of December 31, 2020. ORIOLE TRIAL BALANCE DECEMBER 31, 2020 Cash Accounts Receivable Supplies Prepaid Insurance Equipment Accumulated Depreciation Equipment Accounts Payable Interest Payable Notes Payable Unearned Service Revenue Unadjusted Adjusted Dr. Cr. Dr. _ Cr $20,000 $20,000 22.000 26,500 9,000 2,800 2,500 1.850 71.000 71.000 $31.000 $36.000 7.000 7,000 330 11,000 11,000 7,500 6.200 1,600 13.000 13,000 5.000 5,000 71.800 77,600 16,600 18,200 650 530 5,000 6,200 5,000 5,000 $146,300 $146,300 $157,730 $157,730 Salaries and Wages Payable Common Stock Retained Earnings Service Revenue Salaries and Wages Expense Insurance Expense Interest Expense Depreciation Expense Supplies Expense Rent Expense

Answer 1

Oriole Journal entries Date Account 31-Dec Accounts Receivable Service Revenue Credit Debit $ 4,500 Calculation =26,500-22,000 $ 4,500 $ 1,300 =7,500-6,200 31-Dec Uneanred Service Revenue Service Revenue $ 1,300 $ 6,200 =9,000-2,800 31-Dec Supplies expense Supplies $ 6,200 $ 5,000 =36,000-31,000 31-Dec Depreciation expense Accumulated Depreciation Equipment $ 5,000 $ 330 =330-0 31-Dec Interest expense Interest payable $ 330 $ 650 =2,500-1,850 31-Dec Insurance expense Prepaid insurance $ 650 $ 1,600 =18,200-16,600 31-Dec Salaries and wages expense Salaries and wages payable $ 1,600

Adjustments Debit Credit Calculation Credit Debit 4,500 =26,500-22,000 Unadjusted TB Debit Credit 20,000 22,000 9,000 2,500 71,000 31,000 7,000 6,200 650 =9,000-2,800 =2,500-1,850 5,000 =36,000-31,000 330 =330-0 Oriole Account Names Cash Accounts Receivable Supplies Prepaid insurance Equipment Accumulated Depreciation-Equipment Accounts payable Interest payable Notes payable Uneanred Service Revenue Salaries and wages payable Common Stock Retained Earnings Service Revenue Salaries and wages expense Insurance expense Interest expense Depreciation expense Supplies expense Rent expense Totals 11,000 7,500 Adjusted TB Debit Credit 20,000 26,500 2,800 1,850 71,000 36,000 7,000 330 11,000 6,200 1,600 13,000 5,000 77,600 18,200 650 530 5,000 6,200 5,000 157,730 157,730 1,300 =7,500-6,200 1,600 =1,600-0 13,000 5,000 71,800 5,800 =77,600-71,800 16,600 200 1,600 650 330 5,000 6,200 =18,200-16,600 =650-0 =530-200 =5,000-0 =6,200-0 5,000 146,300 146,300 19,580 19,580

77,600 Oriole Income Statement Year Ended December 31, 2020 Revenues Service Revenue Expenses Salaries and wages expense Insurance expense Interest expense Depreciation expense Supplies expense Rent expense Total Expenses Net Income 18,200 650 530 5,000 6,200 5,000 35,580 42,020 Statement of Retained Earnings Year Ended December 31, 2020 Beginning Retained Earnings Add: Net Income Ending Retained Earnings 5,000 42,020 47,020

Oriole Balance Sheet December 31, 2020 Assets Cash 20,000 26,500 2,800 1,850 Accounts Receivable Supplies Prepaid insurance Equipment Accumulated Depreciation Equipment Total Assets 71,000 (36,000) 35,000 86,150 Liabilities & Stockholders Equity Liabilities Accounts payable Interest payable Notes payable Uneanred Service Revenue Salaries and wages payable Total Liabilities 7,000 330 11,000 6,200 1,600 26,130 Stockholders Equity Common Stock 13,000 Retained earnings 47,020 Total Stockholders Equity 60,020 Total Liabilities & Stockholders Equity 86,150 - Check Req1 If note has been outstanding 3 months, what is annual interest rate on that note? Annual Interest Rate 19% Workings Loan amount * Interest rate * Term Interest rate Interest expense Interest expense/ (Loan amount * Term (months)) *12 =530/(11,000*3)*12 19% Interest rate Req 2 If company paid $19,300 in salaries and wages in 2020, what was the balance in Salaries & Wages Payable on 31 December, 2019? Salaries and wages Payable on 31 Dec 2019 2,700 Year 2020 Salaries and wages paid in 2020 Salaries and wages expense Salaries and wages Payable - closing bal Salaries and wages Payable on 31 Dec 2019 19,300 (18,200) 1,600 2,700