Question

  
On January 1, 2021, Red Flash Photography had the following balances: Cash, $16,000; Supplies, $8,400; Land, $64,000; Deferred Revenue, $5,400; Common Stock $54,000; and Retained Earnings, $29,000. During 2021, the company had the following transactions:

1.		February		15		Issue additional shares of common stock, $24,000.
2.		May		20		Provide services to customers for cash, $39,000, and on account, $34,000.
3.		August		31		Pay salaries to employees for work in 2021, $27,000.
4.		October		1		Purchase rental space for one year, $16,000.
5.		November		17		Purchase supplies on account, $26,000.
6.		December		30		Pay dividends, $2,400.

The following information is available on December 31, 2021:

1. Employees are owed an additional $4,400 in salaries.
2. Three months of the rental space has expired.
3. Supplies of $5,400 remain on hand.
4. All of the services associated with the beginning deferred revenue have been performed.

Prepare an adjusted trial balance.

Débit Credit Totals %24

Answer 1

Answer:

For the year ended December 31,2021
Accounts	Debit	Credit
Cash	$33,600
Accounts receivable	$34,000
Supplies	$5,400
Prepaid rent	$12,000
Land	$64,000
Accounts payable		$26,000
Deferred revenue		$0
Salaries payable		$4,400
Common stock		$78,000
Retained earnings		$29,000
Dividends	$2,400
Service revenue		$78,400
Salaries expense	$31,400
Rent expense (16,000 x 3/12)	$4,000
Supplies expense (8,400+26,000-5,400)	$29,000
Total	$215,800	$215,800

Calculations:

Cash	16000+24000+39000-27000-16000-2400
Accounts receivable	34000
Supplies	8400+26000-29000
Prepaid rent	16000-4000
Land	64000
Accounts payable		26000
Deferred revenue		5400-5400
Salaries payable		4400
Common stock		54000+24000
Retained earnings		29000
Dividends	2400
Service revenue		73000+5400
Salaries expense	27000+4400
Rent expense (16,000 x 3/12)	4000
Supplies expense (8,400+26,000-5,400)	29000