Question

Determining Adjusting Entries, Posting to T Accounts, and Preparing an Adjusted Trial Balance P6. Brave Advisors Service's trial balance on December 31, 2014, is as follows. GENERAL LEDGER Adjusted trial balance: $121,792 16,500 8,250 2,662 1,320 9.240 Brave Advisors Service Trial Balance December 31, 2014 Cash Accounts Receivable Office Supplies Prepaid Rent Office Equipment Accumulated Depreciation Office Equipment Accounts Payable Notes Payable Unearned Service Revenue B. Cooper, Capital B. Cooper, Withdrawals Service Revenue Salaries Expense Rent Expense Utilities Expense 1,540 5,940 11,000 2.970 24,002 22,000 72,600 49,400 4,400 4,280 118,052 118,052 The following information is also available: a. Ending inventory of office supplies, $264 b. Prepaid rent expired, $440 c. Depreciation of office equipment for the period, S660 d. Accrued interest expense at the end of the period, S550 e. Accrued salaries at the end of the period, $330 f. Service revenue still unearned at the end of the period, S1,166 5. Service revenue earned but unrecorded, $2,200 REQUIRED 1. Open T accounts for the accounts in the trial balance plus the following: Interest Payable; Salaries Payable; Office Supplies Expense; Depreciation Expense Office Equipment; and Interest Expense. Enter the balances shown on the trial balance. 2. Determine the adjusting entries and post them directly to the T accounts. 3. Prepare an adjusted trial balance. 4. ACCOUNTING CONNECTION Which financial statements do cach of the above adjustments affect? Which financial statement is not affected by the adjustments?

Answer 1

Ques 1 & 2

Cash Accounts Receivable Bal. 16,500 Bal. 8,250 (8) 2,200 Bal. D 10,450 Prepaid Rent Office Equipment Bal. D 1 ,320 (b) 1 Bal 9,240U 9,240 Bal. 880 Accounts Payable Notes Payable Bal. 5,940 T Bal. 11,000 Salaries Payable Unearned Service Revenue 1,804 L Bal. I 2,970 1,166 B. Cooper, Withdrawals Service Revenue Bal. 22,000 Bal. 72,600 1,804 2,200 Bal. 76,604 Rent Expense Utilities Expense Bal. 4,280 4,400 440 (b) 1 Bal. 1 4,840 Depreciation Expense- Office Equipment Interest Expense 660 5501 550

Office Supplies 12,662 (a) 2,398 Bal. 1 264 Accumulated Depreciation- Office Equipment Bal. 1,540 660 Bal. 1 2,200 Interest Payable (d) B. Cooper, Capital Bal. 24,002 ITH UH UH Salaries Expense Bal. 49,400 330 Bal. 49,730 Office Supplies Expense (a) 1 2,398

Ques 3

Brave Advisors Service Adjusted Trial Balance 31-Dec-14 16,500 10,450 264 880 9,240 Cash Accounts Receivable Office Supplies Prepaid Rent Office Equipment Accumulated Depreciation - Office Equipment Accounts Payable Notes Payable Interest Payable Salaries Payable Unearned Service Revenue B. Cooper, Capital B. Cooper, Withdrawals Service Revenue Salaries Expense Rent Expense Utilities Expense Office Supplies Expense Depreciation Expense-Office Equipment Interest Expense 2,200 5,940 11,000 550 330 1,166 24,002 22,000 76,604 49,730 4,840 4,280 2,398 660 550 121,792 121,792

Ques 4

the adjustment affects Balance sheet, income statement, statement of owner's equity

The statement of cash flows is not affected by the adjustments.