Question

Exercise 3-20A Record transactions and prepare adjusting entries, adjusted trial balance, financial statements, and closing entries (LO3-3, 3-4, 3-5, 3-6, 3-7) (GL) 4. October On January 1, 2021, Red Flash Photography had the following balances: Cash, $25,000; Supplies, $9,300; Land, $73,000; Deferred Revenue, $6,300; Common Stock $63,000; and Retained Earnings, $38,000. During 2021, the company had the following transactions: 1. February 15 Issue additional shares of common stock, $33,000. 2. May 20 Provide services to customers for cash, $48,000, and on account, $43,000. 3. August 31 Pay salaries to employees for work in 2021, $36,000. 1 Purchase rental space for one year, $25,000. 5. November 17 Purchase supplies on account, $35,000. 6. December 30 Pay dividends, $3,300. The following information is available on December 31, 2021: 1. Employees are owed an additional $5,300 in salaries. 2. Three months of the rental space has expired. 3. Supplies of $6,300 remain on hand. 4. All of the services associated with the beginning deferred revenue have been performed.

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Answer The answers of incorrect parts are given below No Date Account Title Debit Credit 5 35,000 Nov-17 Supplies Accounts Payable 35,000 9 38,000 Dec-31 Supplies Expense (9,300 + 35,000 - 6,300) Supplies 38,000 11 +6,300) 97,300 Dec-31 Service Revenue (91, Retained Earnings 97,300 12 85,550 Dec-31 Retained Earnings Salaries Expense Rent Expense Supplies Expense 41,300 6,250 38,000