Question

Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the company's unadjusted trial balance as of December 31, 2019. December 31, 2019 Cash Unadjusted Trial Balance $ 17,000 4,000 $ 828 11,700 32,000 45,000 12,200 5,000 1,400 15,000 59,700 10,000 Accounts receivable Allowance for doubtful accounts Merchandise inventory Trucks Accum. depreciation-Trucks Equipment Accum. depreciation-Equipment Accounts payable Estimated warranty liability Unearned services revenue Interest payable Long-term notes payable D. Buggs, Capital D. Buggs, Withdrawals Extermination services revenue Interest revenue Sales (of merchandise) Cost of goods sold Depreciation expense-Trucks Depreciation expense-Equipment Wages expense Interest expense Rent expense Bad debts expense Miscellaneous expense Repairs expense Utilities expense Warranty expense Totals 60,000 872 71,026 46,300 35,000 9,000 1,226 8,000 6,800 $ 226,026 $226,026

Answer 1

Solutions:

a.

Reconciled Balance (Cash)
Particulars	Amount	Amount
Bank Balance		15100
Add:
Deposit In Transist	2450
Bank Service Charges	15	2465
Subtotal		17565
Less:
Outstanding Chq	1800
Interest Earned	52	1852
Reconciled Cash Balance		15713

Omitted Check
Cash Balance as per books	17000
Less: Reconciled cash balance	15713
Omitted Check	1287

b.

Allowance for doubtful Debts as per trial balance	828
Ending Balance of Allowance of doubtful debts after writing off uncollectibles	700
Necessary Adjustment	128

c.

Depreciation for truck
Original Cost	32000
Less: Salvage Value	8000
Depreciable Value	24000
Useful life	4
Depreciation per year	=24000/4
Depreciation Expense	6000

d.

	Sprayer	Injector
Original Cost	27000	18000
Less: Salvage Value	3000	2500
Depreciable Value	24000	15500
Useful life	8	5
Depreciation per year	=24000/8	=15500/5
Depreciation Expense	6000	3875