Using an adjusted trial balance to prepare financial statementsRefer to the data in Exerci...

Using an adjusted trial balance to prepare financial statements

Refer to the data in Exercise.

Requirements

1. Compute First Class Maids Company’s net income for the period ended December 31, 2012.

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2. Compute First Class Maids Company’s total assets at December 31, 2012.

Exercise

Preparing adjusting entries and preparing an adjusted trial balance

First Class Maids Company, the cleaning service, started the preparation of its adjusted trial balance as follows:

During the 12 months ended December 31, 2012, First Class Maids

a. used supplies of $1,800.

b. used up prepaid insurance of $620.

c. used up $460 of the equipment through depreciation.

e. accrued salary expense of $310 that First Class Maids hasn’t paid yet.

d. earned $360 of the unearned service revenue.

Requirement

1. Prepare an adjusted trial balance. Use Exhibit 3-8 as a guide. Key each adjustment by letter.