Question

Everly Company Unadjusted Trial Balance December 31, 2018 106,000 28,000 7,500 30,000 110,000 15,000 80,000 Cash Accounts Receivable Supplies Prepaid Insurance Inventory Vehicle Equipment Accumulated Depreciation Accounts Payable Unearned Revenue Wages Payable Long-Term Notes Payable Common Stock Retained Earnings (1/1/2018) Dividends Service Revenue Repair Expense Delivery Expense Depreciation Expense Rent Expense Insurance Expense Wages Expense Supplies Expense Interest Expense Income Tax Expense Total 46,000 8,000 17,900 12,500 50,000 46,000 47,600 5,000 465,500 12,000 45,000 2,000 48,000 10,000 143,000 14,000 3,000 35,000 693,500 693,500 Part 1: Prepare adjusting journal entries using the unadjusted trial balance provided to you in Question 1 of the Financial Statement Homework quiz on D2L and the Page 1 of 9

Answer 1

Adjusting Journal Entry No Accounts Title and Explanation 1 Insurance Expense To Prepaid Insurance Debit ($) Credit ($) 10000 10000 15000 2 Depreciation Expense To Accumulated Depreciation 15000 8000 3 Wages Expense To Wage payable 8000 12900 4 Unearned Revenue To Service Revenue 12900 8000 5 Accounts Receivable To Service Revenue 8000 3500 6 Supplies Expense To Supplies 3500

Cash 106000 106000 Beg Bal. End Bal. Account Receivable 28000 8000 Beg Bal. 5 End Bal. 1 Inventory 110000 110000 Beg Bal. End Bal. Prepaid Insurance 30000 10000 20000 Beg Bal. End Bal. 36000 Wages Expense 143000 8000 Vehicle 15000 Beg Bal. 3 End Bal. 6 Supplies 7500 3500 4000 Common Stock 46000 Beg Bal. 46000 End Bal. Beg Bal. End Bal. Beg Bal. End Bal. 15000 151000 Equipment 80000 Depreciation Expense Beg Bal. 2000 2. 15000 End Bal. 17000 Service Revenue 465500 Beg Bal. 12900 4 8000 5 486400 End Bal. Repair Expense 12000 12000 Beg Bal. End Bal. 80000 Beg Bal. End Bal. Delivery Expense 45000 Beg Bal. End Bal. Beg Bal. Supplies Expense 14000 3500 17500 Dividend 5000 5000 45000 Beg Bal. End Bal. 6 End Bal. Wage Payable 12500 Beg Bal. 8000 3 20500 End Bal. 4 Uneraned Revenue 12900 17900 Beg Bal. 5000 End Bal. Long term Notes Payable 50000 Beg Bal. 50000 End Bal. Account Payable 8000 Beg Bal. 8000 End Bal. Beg Bal. End Bal. Rent Expense 48000 48000 Beg Bal. End Bal. Interest expense 3000 3000 Retained Earning 47600 Beg Bal. 47600 End Bal. Accumulated Depreciation 46000 Beg Bal. 15000 2 61000 End Bal. Income Tax expense 35000 Beg Bal. Beg Bal. 1 End Bal. Insurance Expense 10000 10000 20000 End Bal. 35000

Credit (S) 46000 8000 47600 20500 486400 EVERLY COMPANY December 31, 2018 Adjusted Trial balance Account Titles Debit (S) Cash 106000 Account Receivable 36000 Inventory 110000 Prepaid Insurance 20000 Vehicle 15000 Supplies 4000 Common Stock Account Payable Retained Earning Wage Payable Service Revenue Equipment 80000 Delivery Expense 45000 Uneraned Revenue Interest expense 3000 Depreciation Expense 17000 Dividend 5000 Long term Notes Payable Accumulated Depreciation Income Tax expense 35000 Repair Expense 12000 Supplies Expense 17500 Wages Expense 151000 Rent Expense 48000 Insurance Expense 20000 Total 724500 5000 50000 61000 724500

EVERLY COMPANY Income Statement For the year ended Decemebr 31, 2018 Revenue : Service Revenue $ 486400 Expense : Delivery Expense 45000 Interest expense 3000 Depreciation Expense 17000 Income Tax expense 35000 Repair Expense 12000 Supplies Expense 17500 Wages Expense 151000 Rent Expense 48000 Insurance Expense 20000 Total Expense $ 348500 Net Income $137900 EVERLY COMPANY Statement of Retained Earning For the year ended Decemebr 31,2018 Beginning balance of Retained Earning Add : Net Income $ 47600 137900 185500 Less : Dividend Ending balance of Retained Earning (5000) $ 180500

EVERLY COMPANY Balancesheet For the year ended Decemebr 31,2018 Assets Amount ($) Amount ($) Current Asset Cash 106000 Account Receivable 36000 Inventory 110000 Supplies 4000 Prepaid Insurance 20000 Total Current asset 276000 Property, Plant and Equipments Vehicle 15000 Equipment 80000 Less : Accumulated Depreciation - Equipment (61000)| Property, Plant and Equipments - Net 34000 Total Assets 310000 Liabilities and Stockholders' Equity Current Liabilities Account Payable 8000 Wage Payable 20500 Uneraned Revenue 5000 Total Current Liabilities 33500 Long term liabilities Long term Notes Payable 50000 Stockholders' Equity Common Stock 46000 Retained Earning 180500 Total stockholders' equity 226500 Total liabilities and stockholders' equity 310000

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