Question

Refer to the following Hawkeye Ranges. As of December 31, 2017, employees had earned $1,296 of unpaid and unrecorded salaries. The next payday is January 4, at which time $2,307 of salaries will be paid. The cost of supplies still available at December 31, 2017, is $3,904. The notes payable requires an interest payment to be made every three months. The amount of unrecorded accrued interest at December 31, 2017, is $1,125. The next interest payment, at an amount of $1,350, is due on January 15, 2018. Analysis of the unearned member fees account shows $8,099 remaining unearned at December 31, 2017. In addition to the member fees included in the revenue account balance, the company has earned another $13,040 in unrecorded fees that will be collected on January 31, 2018. The company is also expected to collect $8,000 on that same day for new fees earned in January 2018. Depreciation expense for the year is $18,409. Required: 1. Complete the six-column table by entering adjustments that reflect the above information. 2. Prepare journal entries for the adjustments entered in the six-column table for part 1. 3. Prepare journal entries to reverse the effects of the adjusting entries that involve accruals. 4. Prepare journal entries to record the cash payments and cash collections described for January. (Assume reversing entries were prepared.)

HAWKEYE RANGES Partial Work Sheet December 31, 2017 Unadjusted Adjusted Trial Balance Adjustments Trial Balance Account Title Dr. Cr. Dr. Cr. Dr. Cr. Cash $18,800 Accounts receivable 0 Supplies 7,952 Equipment 191,760 Accumulated depreciation—Equipment $36,818 Interest payable 0 Salaries payable 0 Unearned member fees 20,248 Notes payable 45,000 P. Hawkeye, Capital 111,817 P. Hawkeye, Withdrawals 28,200 Member fees earned 76,704 Depreciation expense—Equipment 0 Salaries expense 40,500 Interest expense 3,375 Supplies expense 0 Totals $290,587 $290,587 $0 $0 $0 $0

Answer 1

	Unadjusted trial balance		Adjusting entries		Adjusted trial balance
	Debit	Credit	Debit	Credit	Debit	Credit
Cash	18800				18800
Accounts receivable	0				0
Supplies	7952			4048	3904
Equipment	191760				191760
Accumulated depreciation equipment		36818		18409		55227
Interest payable		0		1125		1125
Salaries payable		0		1296		1296
Unearned member fees		20248	12149			8099
Notes payable		45000				45000
P. Hawkeye , Capital		111817				111817
P. Hawkeye , Drawings	28200				28200
Member fees earned		76704		12149		88853
Depreciation expense - equipment	0		18409		18409
Salaries expense	40500		1296		41796
Interest expense	3375		1125		4500
Supplies expense	0		4048		4048
Totals	290587	290587	37027	37027	311417	311417