Question

Home 1 Howdx TM Class Prepara xl Readinas and x G Physical activx New Tab X IMG_1419.jpeg Open with Preview GO boo $300 120 402 36 The balance sheet for Amold's Cleaners appears below Arold's Cleaners Balance Sheet December 31, 2001 Assets Liables Cash $400 Accounts payable Accounts receivable 460 Salary payable Supplies 10 Unearned revenue Prepaid insurance 60 Note payable due in 5 years! Equipment $400 Totalbes Less: Ace, depe 40 360 Stockholders' Equity Land 400 Common stock Retained earnings Total stockholders' equity Totaisbites and stockholders' Totalas $1.699 equity Arnold's currentet for 2015 А 2.11 Arcata B 2.09 Gun T. 2 1.52 370 482 350 $1699 CR 7450 KADO 19.00 Table 3-1 Lemon Car Rental Unadjusted Trial Balance December 11, 2004 $ 7450 1,600 19.000 $ 4,200 5,000 - 15.600 6,000 23,400 7,000 4,000 Cash Prepaid insurance Equipment Accumulated Depreciation Accounts Payable Beginning Retained Earnings Dividends Rental Revenue Insurance Expense Salary Expense Repair Expense Adjusting entries include: (1) Prepaid in ved 2 Depreciation 4200 $ 48.200 1.300 Refer to the credit came of the adjud balance should total 145.000 senso D. SS1,100 Refert. Am the net income is 6.50. The ending balance of Retained Earning should be c $15.90 $9.000 LICIES Choices Mes alth....docx Team hyookinet.pdf A w 2
how do i figure out the bottom two questions?

Answer 1

QUESTION 37

The correct option is (C), i.e., $49,500.

Adjusting entries effect in the adjusted trial balance:

In the first case, prepaid insurance used - there will be decrease in prepaid insurance account with $1,600 and there will be an increase in the Insurance Expense Account with $1,600. There will be no effect in the credit side of the adjusted trial balance.

In the second case, depreciation - there will be an increase in accumulated depreciation which effect in the credit side of the adjusted trial balance and there will be a depreciation expense account in the debit side of the adjusted trial balance.

Therefore, the credit side of the adjusted trial balance will be $49,500.

QUESTION 38

According to the question,

Net Income = $6,350

Dividend = $6,000

Beginning balance of Retained Earning = (15,600)

Therefore, Retained Earning = Net Income + Beginning balance of the retained earning - Dividend

=$ [6,350 + (-15,600) - 6,000]

= $ 15,250.

** $15,250 is the correct answer but it is not provided in the options.