Question

The Spooky Store is located in midtown Salem. During the past several years, net income has been declining because of suburban shopping centers. At the end of the company’s fiscal year on October 31, 2019, the following accounts appeared on the unadjusted trial balance. Adjusting entries were entered into the worksheet but not into the adjusted trial balance.

Instructions

(a) Complete the worksheet for Spooky Store. Prepare the adjusted trial balance and extend accounts to the income statement and balance sheet columns.

Spooky Stores Worksheet For the Month Ended October 31, 2019 Trial Balance Account Titles Cash 98,000 23,000 29,000 10,000 Accounts Receivable Inventory Prepaid Insurance 7000 157,000 Accumulated Depr.--Equip Accounts Payable 74,000 14000 66,000 30,000 78,000 604,000 12000 Notes Payable (due in 2021) Common Stock Retained Earnings Dividends Sales Revenue Sales Returns and Allowances 20,000 Cost of Goods Sold Salaries and Wages Expense 84,000 Sales Commissions Expense Depreciation Expense Insurance Expense Rent Ex 23,000 423,000 12000 14000 7000 7,000 Utilities Expense Totals Net Income 4,000 892,000892,000 33000 33000

Answer 1

Spooky Stores
			Work Sheet
			For the Month Ended October 31, 2019
	Trial Balance		Adjustments		Adjusted Trial Balance		Income Statement		Balance Sheet
	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Cash	98,000				98,000				98,000	-
Accounts Receivable	23,000				23,000				23,000	-
Inventory	29,000				29,000				29,000	-
Prepaid Insurance	10,000			7,000	3,000				3,000	-
Equipment	157,000				157,000				157,000	-
Accumulated Depr - Equip		74,000		14,000		88,000			-	88,000
Accounts Payable		66,000				66,000			-	66,000
Sales Commission Payable				12,000		12,000			-	12,000
Notes Payable (Due in 2021)		30,000				30,000			-	30,000
Common Stock		40,000				40,000			-	40,000
Retained Earnings		78,000				78,000			-	78,000
Dividends	23,000				23,000	-			23,000	-
Sales Revenue		604,000				604,000	-	604,000
Sales Return and Allowances	20,000				20,000		20,000	-
Cost of Goods Sold	423,000				423,000		423,000	-
Salaries and Wages Expense	84,000				84,000		84,000	-
Sales Commission Expense	7,000		12,000		19,000		19,000	-
Depreciation Expense			14,000		14,000		14,000	-
Insurance Expense			7,000		7,000		7,000	-
Rent Expense	14,000				14,000		14,000	-
Utilities expense	4,000				4,000		4,000	-
Totals	892,000	892,000	33,000	33,000	918,000	918,000	585,000	604,000	333,000	314,000
Net Income								19,000		19,000

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