Question

Application Problem -153ad Eric Shehan is a student working on an internship at Mabon Ltd. On December 31, 2020, the company hadits year and Eric's boss brought him the following information Accounts Payable Cash Notes Payable Inventory Common Shares Sales Revenge Retained Earnings (Manuary 1, 2020) Cost of Goods Sold s Expense Interest Revenue Accounts Receivable Interest Expense $219.000 Wapes Expense 117.000 Notes Receivable 251.000 Rent Expense 313,000 Dividends Declared 351.000 Supplies 3.396.000 Insurance Expense 1.158.000 Equipment 2.064,000 Accumulated Depreciation Equipment 87,000 Miscellaneous Expense 9,000 Uneamed Revenue 427,000 Advertising Expense 7.000 $362,000 199,000 33,000 179,000 11,000 16.000 1,672,000 162,000 33,000 29,000 55,000 U These account amounts are correct, but Eric's boss advised him that the information did not reflect the following information: 1. Accrued interest of $6,000 on the notes receivable 2. Employees earned 581,000 in bonuses based on achieving sales targets. These are payable on January 10, 2021. 3. Accrued interest on the note payable amounting to $6,000 is due in January 2021. 4. As of December 31, 2020, the supplies still on hand had a cost of $8,000. 5. The insurance expense includes 14,000 in premiums related to coverage for 2021. Depreciation for 2020 $100,000 on the equipment The company's board declared additional dividends of $252,000, which are payable to shareholders on January 15, 2021

Answer 1

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	Unadjusted		Adjustments				Adjusted
	Debit	Credit	Debit		Credit		Debit	Credit
Cash	$       117,000						$       117,000
Accounts Payable		$       219,000						$       219,000
Notes Payable		$       251,000						$       251,000
Inventoiry	$       313,000						$       313,000
Common Shares		$       351,000						$       351,000
Sales Revenue		$   3,396,000						$   3,396,000
Retained Earning		$   1,158,000						$   1,158,000
Cost of goods sold	$   2,064,000						$   2,064,000
Utilities Expense	$         87,000						$         87,000
Interest Revenue		$            9,000			1	$            6,000		$         15,000
Accounts Receivable	$       427,000						$       427,000
Interest Expense	$            7,000		3	$            6,000			$         13,000
Wages Exense	$       362,000		2	$         81,000			$       443,000
Notes Receivable	$       199,000						$       199,000
Rent Expense	$         33,000						$         33,000
Dividend Declared	$       179,000		7	$       252,000			$       431,000
Supplies	$         11,000				4	$            3,000	$            8,000
Insurance Expense	$         16,000				5	$            4,000	$         12,000
Equipment	$   1,672,000						$   1,672,000
Accumulated Depreciation		$       162,000			6	$       168,000		$       330,000
Miscellaneous Expense	$         33,000						$         33,000
Unearned Revenue		$         29,000						$         29,000
Advertising Expense	$         55,000						$         55,000
Accrued Interest			1	$            6,000			$            6,000
Wages Payable					2	$         81,000		$         81,000
Interest Payable					3	$            6,000		$            6,000
Supplies Expense			4	$            3,000			$            3,000
Prepaid Insurance			5	$            4,000			$            4,000
Depreciation Expense			6	$       168,000			$       168,000
Dividend Payable					7	$       252,000		$       252,000
Total	$   5,575,000	$   5,575,000		$       520,000		$       520,000	$   6,088,000	$   6,088,000