Question

Hello! I need help in the Adjusted Trial Balance portion of this assignment. The credit & debit aren't matching and I am unsure why.

[The following information applies to the questions displayed below.]

Tony and Suzie graduate from college in May 2021 and begin developing their new business. They begin by offering clinics for basic outdoor activities such as mountain biking or kayaking. Upon developing a customer base, they’ll hold their first adventure races. These races will involve four-person teams that race from one checkpoint to the next using a combination of kayaking, mountain biking, orienteering, and trail running. In the long run, they plan to sell outdoor gear and develop a ropes course for outdoor enthusiasts.

On July 1, 2021, Tony and Suzie organize their new company as a corporation, Great Adventures Inc. The articles of incorporation state that the corporation will sell 29,000 shares of common stock for $1 each. Each share of stock represents a unit of ownership. Tony and Suzie will act as co-presidents of the company. The following transactions occur from July 1 through December 31.

Jul.		1		Sell $14,500 of common stock to Suzie.
Jul.		1		Sell $14,500 of common stock to Tony.
Jul.		1		Purchase a one-year insurance policy for $5,040 ($420 per month) to cover injuries to participants during outdoor clinics.
Jul.		2		Pay legal fees of $1,900 associated with incorporation.
Jul.		4		Purchase office supplies of $1,600 on account.
Jul.		7		Pay for advertising of $220 to a local newspaper for an upcoming mountain biking clinic to be held on July 15. Attendees will be charged $40 on the day of the clinic.
Jul.		8		Purchase 10 mountain bikes, paying $16,800 cash.
Jul.		15		On the day of the clinic, Great Adventures receives cash of $2,800 from 70 bikers. Tony conducts the mountain biking clinic.
Jul.		22		Because of the success of the first mountain biking clinic, Tony holds another mountain biking clinic and the company receives $3,150.
Jul.		24		Pay $700 to a local radio station for advertising to appear immediately. A kayaking clinic will be held on August 10, and attendees can pay $140 in advance or $190 on the day of the clinic.
Jul.		30		Great Adventures receives cash of $5,600 in advance from 40 kayakers for the upcoming kayak clinic.
Aug.		1		Great Adventures obtains a $38,000 low-interest loan for the company from the city council, which has recently passed an initiative encouraging business development related to outdoor activities. The loan is due in three years, and 6% annual interest is due each year on July 31.
Aug.		4		The company purchases 14 kayaks, paying $23,800 cash.
Aug.		10		Twenty additional kayakers pay $3,800 ($190 each), in addition to the $5,600 that was paid in advance on July 30, on the day of the clinic. Tony conducts the first kayak clinic.
Aug.		17		Tony conducts a second kayak clinic, and the company receives $12,000 cash.
Aug.		24		Office supplies of $1,600 purchased on July 4 are paid in full.
Sep.		1		To provide better storage of mountain bikes and kayaks when not in use, the company rents a storage shed for one year, paying $3,840 ($320 per month) in advance.
Sep.		21		Tony conducts a rock-climbing clinic. The company receives $15,000 cash.
Oct.		17		Tony conducts an orienteering clinic. Participants practice how to understand a topographical map, read an altimeter, use a compass, and orient through heavily wooded areas. The company receives $19,000 cash.
Dec.		1		Tony decides to hold the company’s first adventure race on December 15. Four-person teams will race from checkpoint to checkpoint using a combination of mountain biking, kayaking, orienteering, trail running, and rock-climbing skills. The first team in each category to complete all checkpoints in order wins. The entry fee for each team is $680.
Dec.		5		To help organize and promote the race, Tony hires his college roommate, Victor. Victor will be paid $30 in salary for each team that competes in the race. His salary will be paid after the race.
Dec.		8		The company pays $1,000 to purchase a permit from a state park where the race will be held. The amount is recorded as a miscellaneous expense.
Dec.		12		The company purchases racing supplies for $2,800 on account due in 30 days. Supplies include trophies for the top-finishing teams in each category, promotional shirts, snack foods and drinks for participants, and field markers to prepare the racecourse.
Dec.		15		The company receives $27,200 cash from a total of forty teams, and the race is held.
Dec.		16		The company pays Victor’s salary of $1,200.
Dec.		31		The company pays a dividend of $4,900 ($2,450 to Tony and $2,450 to Suzie).
Dec.		31		Using his personal money, Tony purchases a diamond ring for $3,500. Tony surprises Suzie by proposing that they get married. Suzie accepts and they get married!

The following information relates to year-end adjusting entries as of December 31, 2021.

1. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4 totals $8,900.
2. Six months’ of the one-year insurance policy purchased on July 1 has expired.
3. Four months of the one-year rental agreement purchased on September 1 has expired.
4. Of the $1,600 of office supplies purchased on July 4, $370 remains.
5. Interest expense on the $38,000 loan obtained from the city council on August 1 should be recorded.
6. Of the $2,800 of racing supplies purchased on December 12, $130 remains.
7. Suzie calculates that the company owes $14,300 in income taxes.

Adjusted Trial Balance [!!!]:

Credit GREAT ADVENTURES, Inc. Adjusted Trial Balance December 31, 2021 Accounts Debit Cash $ 94,550 Prepaid Insurance 2,520 Prepaid Rent 2,560 Supplies (Office) 370 Supplies (Racing) 130 Equipment (Bikes) 16,800 Equipment (Kayaks) 23,800 Accumulated Depreciation Accounts Payable Income Tax Payable Interest Payable Notes Payable Common Stock Dividends 4,900 Service Revenue (Clinic) Service Revenue (Racing) Advertising Expense 920 Depreciation Expense 8,900 Income Tax Expense 14,300 Insurance Expense 2,520 Interest Expense 950 Legal Fees Expense 1,900 Miscellaneous Expense 1,000 Rent Expense 1,280 Salries Expense 1,200 Supplies Expense (Office) 1,600 Supplies Expense (Racing) 2,6707 Totals $ 182,870 8,900 2,800 14,300 950 38,000 29,000 55,750 27,200 $ 176,900

In the table above, debit =/= credit and I am unsure where I messed up. Help would be appreciated! Thanks.

(I tried to include the Transactions and Adjusting Entries table but I am unable to add those as the question would be too long)

Answer 1

Trial Balance figures of Service revenue (Clinic) and Supplies (Office) expense are wrong !

Highlighted in orange below:

Adjusted TB As of Dec Debit Credit 94,550 2,520 2,560 370 130 16,800 23,800 8,900 2,800 Great Adventures Inc. Trial Balance Accounts Cash Prepaid Insurance Prepaid Rent Supplies (Office) Supplies (Racing) Equipment (Bikes) Equipment (Kayaks) Accumulated Depreciation Accounts Payable Deferred Revenue Interest Payable Income taxes payable Notes Payable Common stock Retained Earnings Dividends Service revenue (Clinic) Service revenue (Racing) Advertising expense Legal fees expense Misc expense Salary expense Depreciation expense Insurance expense Rent expense Supplies (Office) expense Supplies (Racing) expense Interest expense Income tax expense Totals 950 14,300 38,000 29,000 4,900 61,350 27,200 920 1,900 1,000 1,200 8,900 2,520 1,280 1,230 2,670 950 14,300 182,500 182,500

Credit Date Credit Date Credit Credit Debit Date Prepaid Insurance 5,040 31-Dec Debit Date Prepaid Rent 3,840 31-Dec Date Debit Date Supplies (Office) 4-Jul 1,600 31-Dec 1-Jul 2,520 1 -Sep 1,280 1,230 Great Adventures Inc. T Accounts Date Debit Date Cash 1.Jul 14,500 1-Jul 1-Jul 14,500 2-Jul 15-Jul 2,800 7-Jul 22-Jul 3,150 8-Jul 30-Jul 5,600 24-Jul 1-Aug 38,000 10-Aug 3,800 24-Aug 17-Aug 12,000 1-Sep 21-Sep 15,000 8-Dec 17-Oct 19,000 16-Dec 15-Dec 27,200 31-Dec 4-Aug 5,040 1,900 220 16,800 700 23,800 1,600 3,840 1,000 1,200 4,900 Bal. Bal. 2,520 Bal. Bal. 370 94,550 Supplies (Racing) 2,800 31-Dec Equipment (Bikes) 16,800 2,560 Equipment (Kayaks) 23,800 Accum. Depreciation 31-Dec 12-Dec 2,670 8 -Jul 4-Aug 8,900 Bal. Bal. Bal. 8,900 16,800 Deferred Revenue 5,600 30-Jul Accounts Payable 1,600 4-Jul 12-Dec 23,800 Interest Payable 31-Dec Bal Income taxes payable 31-Dec 24-Aug 10-Aug 5,600 950 14,300 1,600 2,800 2,800 Bal. 950 14,300 Bal. Notes Payable 1-Aug Bal. Dividends 4,900 31-Dec Common Stock 1-Jul 1-Jul Bal. Retained Earnings 36,870 31-Dec 4,900 38,000 31-Dec 88,550 14,500 14,500 31-Dec 31-Dec 4,900 38,000 Bal. 29,000 Bal. Bal. 46,780 Service revenue (Racing) 16-Dec Legal fees expense 1,900 27,200 Advertising expense 220 700 7-Jul 24-Jul 2-Jul Bal. Service revenue (Clinic) 15-Jul 22-Jul 10-Aug 17-Aug 21-Sep 31-Dec 61,350 17-Oct 2,800 3,150 9,400 12,000 15,000 19,000 31-Dec 27,200 31-Dec 920 31-Dec 1,900 - Bal. Bal. Misc expense 1,000 31-Dec Bal. Salary expense 1,200 31-Dec Bal. Depreciation expense 31-Dec 8,900 31-Dec 8-Dec 16-Dec 31-Dec Insurance expense 2,520 31-Dec 1,000 1,200 8,900 2,520 Bal. Bal. Bal. Bal. Supplies (Office) expense 31-Dec 1,230 31-Dec Rent expense 1,280 31-Dec 31-Dec . Interest expense 950 31-Dec Supplies (Racing) expense 31-Dec 2,670 31-Dec 31-Dec 1,280 1,230 2,670 950 Bal. Bal. 31-Dec Income tax expense 14,300 31-Dec 14,300 Bal.

Great Adventures Inc. Journal entries No. Date Accounts 1 1-Jul Cash Common Stock Credit Debit 14,500 14,500 14,500 1-Jul Cash Common Stock 14,500 3 5,040 1-Jul Prepaid Insurance Cash 5,040 4 1,900 2-Jul Legal fees expense Cash 1,900 1,600 4-Jul Supplies (Office) Accounts Payable 1,600 220 7-Jul Advertising expense Cash 220 7 16,800 8-Jul Equipment (Bikes) Cash 16,800 8 2,800 15-Jul Cash Service revenue (Clinic) 2,800 9 3,150 22-Jul Cash Service revenue (Clinic) 3,150 10 700 24-Jul Advertising expense Cash 700 11 5,600 30-Jul Cash Deferred Revenue 5,600 38,000 121-Aug Cash Notes Payable 38,000 13 23,800 4-Aug Equipment (Kayaks) Cash 23,800 14 10-Aug Cash Deferred Revenue Service revenue (Clinic) 3,800 5,600 9,400 15 12,000 17-Aug Cash Service revenue (Clinic) 12,000 16 1,600 24-Aug Accounts Payable Cash 1,600 17 1-Sep Prepaid Rent 3,840 Cash 3,840 18 15,000 21-Sep Cash Service revenue (Clinic) 15,000 19 19,000 17-Oct Cash Service revenue (Clinic) 19,000 20 1-Dec No entry 21 5-Dec No entry 22 1,000 8-Dec Misc expense Cash 1,000 23 2,800 12-Dec Supplies (Racing) Accounts Payable 2,800 24 27,200 15-Dec Cash Service revenue (Racing) 27,200 25 16-Dec Salary expense 1,200 Cash 1,200 26 4,900 31-Dec Dividends Cash 4,900 27 31-Dec No entry

Credit Calculation Adjusting entries No. Date Accounts 28 31-Dec Depreciation expense Accumulated Depreciation Debit 8,900 ACCU 8,900 29 2,520 =5,040/12*6 31-Dec Insurance expense Prepaid Insurance 2,520 30 1,280 =3,840/12*4 31-Dec Rent expense Prepaid Rent 1,280 31 31-Dec Supplies (Office) expense Supplies (Office) 1,230 =1,600-370 1,230 32 950 =38,000*6%*5/12 31-Dec Interest expense Interest Payable 950 33 2,670 =2,800-130 31-Dec Supplies (Racing) expense Supplies (Racing) 2,670 34 14,300 31-Dec Income tax expense Income tax payable 14,300

Credit Closing entries No. Date Accounts 35 31-Dec Service revenue (Clinic) Service revenue (Racing) Retained Earnings Debit 61,350 27,200 88,550 36 36,870 31-Dec Retained Earnings Advertising expense Legal fees expense Misc expense Salary expense Depreciation expense Insurance expense Rent expense Supplies (Office) expense Supplies (Racing) expense Interest expense Income tax expense 920 1,900 1,000 1,200 8,900 2,520 1,280 1,230 2,670 950 14,300 37 4,900 31-Dec Retained Earnings Dividends 4,900