(L.OBJ. 1, 2, 3, 4, 5, 6) Completing the accounting cycle [120-150 min] The trial balan...

(L.OBJ. 1, 2, 3, 4, 5, 6) Completing the accounting cycle [120-150 min]

The trial balance of Coyote Anvils at January 31, 2011, and the data for the month-end adjustments follow:

Adjustment data:

a. Unearned service revenue still unearned at January 31, $400

b. Prepaid rent still in force at January 31, $1,000

c. Supplies used during the month, $500

d. Depreciation for the month, $300

e. Accrued salary expense at January 31, $400

Requirements

1. Prepare adjusting journal entries.

2. Enter the trial balance on a work sheet and complete the work sheet of Coyote Anvils for the month ended January 31, 2011.

3. Prepare the income statement, the statement of owner’s equity, and the classified balance sheet in report form.

4. Using the work sheet data that you prepare, post the adjusting entries and journalize and post the closing entries to T-accounts. Use dates and show the ending balance of each account.

5. Prepare a postclosing trial balance.

6. Calculate the current and debt ratio for the company.