Question

Adjusting Entries Milbank Repairs & Service, an electronics repair store, prepared the following unadjusted trial balance at the end of its first year of operations: Milbank Repairs & Service Unadjusted Trial Balance June 30, 2019 Debit Balances Credit Balances Cach 13,800 Accounts Receivable Supplies 91,610 22,070 519,140 Equipment Accounts Payable 21,520 24,280 374,000 Unearned Fees Nancy Townes, Capital Nancy Townes, Drawing 18,210 551,870 Fees Eamed Wages Expense 128,030 97,680 70,090 Rent Expense Utilities Expense

Answer 1

Requirement 1:

	Account title and Explanation	Debit	Credit
a	Accounts receivable	$9,990
	Fees Earned		$9,990
	[To record accrued revenue]
b	Supplies expense [22,070-8,160]	$13,910
	Supplies		$13,910
	[To record supplies expense]
c	Depreciation expense	$13,800
	Accumulated deprecation-equipment		$13,800
	[To record depreciation expense on equipment]
d	Unearned fees	$19,180
	Fees earned		$19,180
	[To record revenue from unearned]
e	Wages expense	$1,770
	Wages payable		$1,770
	[To record accrued wages expense]

Requirement 2:

Before adjustments
	Revenues:
i	Fees Earned		$551,870
	Expenses:
	Wages expense	$128,030
	Rent expense	$97,680
	Utilities expense	$70,090
	Miscellaneous Expense	$11,040
ii	Total Expenses		$306,840
i-ii	Net income		$245,030

Requirement 3:

After adjustments
	Revenues:
i	Fees Earned [551,870+9,990+19,180]		$581,040
	Expenses:
	Wages expense [128,030+1,770]	$129,800
	Rent expense	$97,680
	Utilities expense	$70,090
	Miscellaneous Expense	$11,040
	Supplies expense	$13,910
	Depreciation expense	$13,800
ii	Total expenses		$336,320
i-ii	Net income		$244,720

Requirement 4:

Adjustments
Fees earned [9,990+19,180]	$29,170
Expenses:
Supplies expense	($13,910)
Depreciation expense	($13,800)
Wages expense	($1,770)
Increase(decrease) due to adjustments in Capital	($310)

Thus, Nancy Townes, Capital decreased by $310