ACCT2001 Computer Services (Jack Smith) Week 3 Chapter 3 Adjustments and Financial Statements

Requirements:

A. Calculate the amounts of the adjusting entries and enter them in the adjustments column. B. Enter the amounts in the adjusted trail balance column. C. Prepare the Income Statement D. Prepare the Statement of Owner’s Equity E. Prepare the Balance Sheet

Given:

Jack Smith opened a new business on July 1. The name of the company is Computer Services.The unadjusted trial balance as of July 31 is presented below.Additional information:

1 An analysis of Prepaid Insurance shows that $75 of coverage has expired.2 An inventory count shows that supplies costing $450 are available at the end of the month3 Monthly depreciation on the equipment is $100.4 On July 1 Computer Services rented part of their office for three months collecting $525.5 Salary expense of $800 have been incurred but are not paid as of July 31.6 Jack determined that there are $700 of revenues earned but not recorded as of July 31.7 Electric used during the month but not recorded was $122.

UnadjustedTrial Balance                       Dr.              Cr.Cash            3,600Accounts Receivable  2,150Supplies    800Prepaid Insurance  450Equipment   6,000Accumulated Depreciation – Equip 0Accounts Payable                 460Salaries Payable                    0Unearned Rent Revenue       525Jack Smith, Capital            10,000Jack Smith, Drawing 750Service Revenue                 5,365Rental Revenue                       0Depreciation Expense  0Insurance Expense 0Rent Expense   700Salaries Expense 1,900Supplies Expense   0Utilities Expense   0Totals     16,350       16,350